Talking Points
NZDJPY outside reversal week shifts bias back to the downside
Weekly opening range taking shape just below multi-month infection zone
Event risk on tap this week
NZD/JPY Daily Chart
Chart Created Using FXCM Marketscope 2.0
Technical Outlook
NZDJPY breaks multi-month support structure at 85.66/84- now resistance
Scalps looking to sell rallies sub today’s high 86.07-bearish invalidation
Breach targets 200DMA & Pitchfork resistance
Interim support 84.25- break targets support objectives at 83.42 & 82.50/59
Daily RSI support-trigger break last week- bearish
Deepest pullback in momentum since January- bearish
Event Risk Ahead: Australia Building Permits & ANZ Business Confidence and Japanese Jobless Rate & Industrial Production tonight and Japanese Tankan Index tomorrow
NZD/JPY 30min Chart
Notes: Last week’s outside reversal candle took out the entire monthly range with the break of the monthly opening range low re-affirming our short-side scalp bias. The pair rebounded off the 2.618% Fibonacci extension off the September highs (at 84.42) in overnight trade and we’ll look to use this move to re-establish short exposure at more favorable levels.
Bottom line: looking to sell rallies while below the 85.68/72 resistance target with only breach above this week’s high at 86.07 invalidating our near-term scalp bias. Caution is warranted on this pair heading into the close of the month/quarter with event risk out of Japan tonight and tomorrow likely to fuel added volatility in yen crosses. Follow the progress of trade setups like these and more throughout the trading week with DailyFX on Demand.
* It’s extremely important to give added consideration regarding the timing of intra-day scalps with the opening ranges on a session & hourly basis offering further clarity on intra-day biases.
Key Threshold Grid
Entry/Exit Targets
Timeframe
Level
Technical Relevance
Resistance Target 1
Daily / 30min
85.02
100% Extension
Resistance Target 2
30min
85.42
23.6% Retracement
Resistance Target 3
Daily / 30min
85.68/73
50% Retrace / August Low
Bearish Invalidation
30min
86.07/10
Weekly ORH / 38.2% Retracement
Break Target 1
Daily / 30min
86.41
23.6% Retracement
Break Target 2
30min
87.00
Soft Resistance / Pivot
Break Target 3
30min
87.19/26
61.8% Retracement & Extension
Break Target 4
30min
87.55/60
Soft Resistance / Pivot / 100DMA
Break Target 5
30min
87.97
78.6% Retracement
Support Target 1
Daily / 30min
84.68
61.8% Retracement (2014 Range)
Bullish Invalidation
Daily / 30min
84.25/42
38.2% Retrace / Sept Low / 2.618% Ext
Break Target 1
30min
84.00
Feb Swing Low / October High
Break Target 2
Daily / 30min
83.45
76.4% Retracement
Break Target 3
Daily / 30min
82.50/59
50% Retracement / 1.618% Extension
Break Target 4
Daily
82.00
Psychological Barrier / Big Figure
Break Target 5
Daily
81.42
2014 Low
Average True Range
Daily (20)
72
Profit Targets 16-18pips
*ORH: Opening Range High
*ORL: Opening Range Low
Other Setups in Play:
GBPUSD Range in Focus- Scalps Target Key Inflection Zone at 1.6253
Scalping The EURAUD Breakout- Longs Favored Above 1.4353
GBPAUD Rally Stalls at Key Resistance – Long Scalps at Risk Sub 1.8444
AUDNZD Scalps Targets Key Inflection Range – 1.1020 Critical Support
AUDJPY Outside Reversal Day- Scalps Favor Buying Dips Above 96.38
EURUSD Short Bias at Risk Ahead of FOMC- 1.29 Bullish Invalidation
AUDCHF Monthly Opening Range Setup- Scalps Target Key Support
—Written by Michael Boutros, Currency Strategist with DailyFX
For updates on this scalp and more setups follow him on Twitter @MBForex
To contact Michael email mboutros@dailyfx.com or Click Here to be added to his email distribution list
Join Michael for Live Scalping Webinars next week on Monday on DailyFX and Tuesday – Thursday on DailyFX Plus (Exclusive of Live Clients) at 12:30 GMT (8:30ET)
Interested in learning about Fibonacci? Watch this Video
Source: Daily fx
