The price of NZDUSD has moved over 600 pips from the recent lows. Will this move continue or are we likely to see some profit taking from buyers?
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The US poor data run continues following on from the recent CPI data PPI came in as previous showing that the data out of the US is beginning to slow. If the same happens to the Retail Sales data later this week this will signal to the Fed that they should slow down the pace of tightening. This recent run of poor data has seen investors push the price of the USD lower which looks likely to continue in the long to medium term.
Looking at the daily chart we can see that the price has moved a significant way with little sell offs. Instead the price has rallied into a key level of resistance at 0.6200 handle. This level has been seen as support or resistance in the past and could be a likely place for currency buyers to reduce some of their position initiating a short term sell off. If this occurs the price is likely to find support at the horizontal and trendline support of 0.6000. To get to this level we first would need to identify if the price is even going to reverse. The 4hr chart is a good place to look for early reversal moves in the market and if this time frame forms a reversal pattern such as the double top. We could consider the sell off phase back in and we could look for short term opportunities to the 0.6000 handle.
Did you see our EURUSD Analysis? You can see it here.
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