Talking Points
NZDUSD testing Fibonacci / channel resistance
Monthly opening range set between 8400-8500
Major Event Risk on tap from US tomorrow
NZDUSD Daily Chart
Chart Created Using FXCM Marketscope 2.0
Technical Outlook
NZDUSD at near-term resistance confluence 8500/15
Breach targets topside resistance objectives 8583/90, 8634- bearishinvalidation
Interim support at 8410/15
Support break targets key objective at 8328/59- bullish invalidation
Daily RSI resistance trigger break- bullish
Major Event Risk Ahead: US Non-farm Payrollstomorrow
NZDUSD Scalp Chart
Notes: The pair is testing resistance ahead of tomorrow’s US employment report and the near-term focus remains on the 8500-handle. The level is defined by the 38.2% retracement of the 2014 range, the April lows and operative trendline resistance off the yearly high. Note that while we have technically broken above the weekly opening range high, we will look for validation tomorrow with NFP’s likely to offer a catalyst. A topside breach of this level sets are bias on a more constructive approach heading into June against 8400.
An outside day reversal of the Dow Jones FXCM US Dollar Index (Ticker: USDOLLAR) at key resistance today supports our base-line scenario noted in yesterday’s report for a “near-term pullback in the greenback heading into the start of the month.” Bottom line: we’ll remain prudent heading into NFPs with a general near-term bias weighted towards the topside while above 8500. A break below 8400 invalidates our near-term outlook with such a scenario targeting a longer-term support objective at 8360. Follow the progress of this trade setup 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
Bearish Invalidation
Daily / 30min
8515/19
100% Ext / April Lows
Break Target 1
30min
8545
38.2% Retracement
Break Target 2
30min
8565/70
Monthly Pivot / Soft Resistance
Break Target 3
Daily / 30min
8586/90
50% Retrace / 61.8% Ext / 50MDA
Break Target 4
Daily / 30min
8634
61.8% Retracement
Break Target 5
Daily
8676
4/10 Close / 2013 High
Support Target 1
Daily / 30min
8496 – 8500
Weekly ORH / 38.2% Retracement
Support Target 2
Daily / 30min
8475/79
Soft Support / 100DMA
Support Target 3
30min
8450
61.8% Ext
Bullish Invalidation
Daily / 30min
8410/15
50% Retrace/ 1.618% Ext / Monthly ORL (8400)
Break Target 1
Daily
8357/64
S1 Monthly Pivot / 38.2% Retrace / 200DMA
Break Target 2
Daily
8328
61.8% Retracement
Average True Range
Daily (20)
55
Profit Targets 14-16pips
*ORH: Opening Range High
*ORL: Opening Range Low
Other Setups in Play Heading into NFPs:
USDCAD Risks Reversal Ahead of NFPs- 1.0950 Key Resistance
EURUSD Targets 2014 Lows Ahead of ECB/NFP- Opening Ranges in Focus
AUDNZD Testing 2014 Range Highs- 1.09 Key Resistance
GBPUSD Scalps Selling Rallies into May Range Lows- Key Support 1.6750
GBPNZD Scalps Target May Opening Range Break- Bullish Above 1.96
AUDUSD Scalps Target Channel Break- Bearish Sub 9300
GBPAUD Scalps Target Key Resistance- Bullish Above 1.7920
—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
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Interested in learning about Fibonacci? Watch this Video
Source: Daily fx
