NZDUSD Daily Chart
Chart Created Using FXCM Marketscope 2.0
Technical Outlook
8673 Represents Key Resistance- 3-way confluence of Channel Resistance, Andrew’s pitchfork and the 88.6% Fibonacci retracement from the decent off the 2011 highs
DailyRSI remains in overbought territory and while our initial bias is to fade this rally, it’s important to note that things can stay overbought for an indefinite time period- As such, we’ll respect a topside breach above this formation as our broader bias remains weighted to the topside
Note the last times we saw 6 days of consecutive rallies
– Jan 27-2012- Next day 0.95% pullback then surged higher
– July 22, 2011- Next day small range- then surged higher
– March 25th 2011- Next day small inside day then surged higher
Topside breach targets 8770 (R3 monthly pivot) and 8817 (1.236% Fibonacci Extension)
Key Support Break below Pitchfork bisector invalidates near-term strength
NZDUSD Scalp Chart
Scalp Notes: Bottom Line: 8675 is Paramount- Topside break on a close basis risks further advances into our resistance targets. The RSI signature since the Sunday open remains constructive with only a dip below the 40-threshold suggesting that the recent rally may have run its course.
*We will remain flexible with our bias with a break above 8675 eyeing subsequent resistance targets. 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. Use this app to distinguish the various trade sessions.
Key Threshold Grid: EURUSD
Entry/Exit Targets
Timeframe
Level
Significance
Bearish Invalidation
Daily
8675
88.6% Retracement
Break Target 1
30min
8700
Big Figure
Break Target 2
30min
8725
Soft Resistance
Break Target 3
Daily
8770
R3 Monthly Pivot
Break Target 4
Daily
8817
123.6% Fibonacci Ext
Support Target 1
30min
8625
Soft Support
Support Target 2
30min
8600
23.6% Retracement
Support Target 3
30min
8575
Soft Support
Support Target 4
30min
8555
38.2% Retracement
Support Target 5
30min
8520
50% Retracement
Bullish Invalidation
30min
8485
61.8% Retracement
Break Target 1
30min
8460
Soft Support
Break Target 2
30min
8436
76.4% Retracement
Average True Range
Daily
65
Profit Targets 15-17pips
For updates on this scalp and more setups attend Michael’s Scalp Webinars or follow him on Twitter @MBForex
Reviews today’s Scalp Webinar for further insights and current trade setups
—Written by Michael Boutros, Currency Strategist with DailyFX
To contact Michael email mboutros@dailyfx.com or Click Here to be added to his email distribution list
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