Talking Points
EURNZD correction eyes key support- 1.6154/78- bullish invalidation
Look for break above 1.6355 to validate shift in near-term bias
Event risk on tap Eurozone tomorrow (medium)
EURNZD Daily Chart
Chart Created Using FXCM Marketscope 2.0
Broader Technical Outlook
EURNZD heading into major support range 1.6220, 1.6154/78(TL Support Dating 4/11/13)
Break targets objectives at 1.6002 & 1.5919
Near-term breach above 1.6350/55 shift scalp bias to the topside
Initial topside objectives 1.6482/97, 1.6566/75, 1.6650
Note the momentum signature continues to hold the October low- supportive
Event Risk Ahead: Eurozone CPI Tomorrow, ECB Monthly Report
EURNZD Scalp Chart
Notes: The focus for this pair has been the response to near-term support at 1.6220 and while our broader view remains weighted to the topside, we cannot rule out another low to test trendline support dating back to April. Nevertheless the levels are set and in the near-term we look for a break above 1.6355 for conviction on long exposure. A break below 1.6268 puts us neutral with a move sub-1.6220 eyeing key support at 1.6155/78. Look for a breakout in the momentum signature to offer further validation our scalp bias as the oscillator continues to consolidate. Bottom line: looking to buy dips/breaks of resistance while above 1.6153.
Note that the pair has a rather healthy ATR and with the ECB monthly report on tap tomorrow, the new batch of central bank rhetoric may spark further Euro volatility. We’ll be following the progress of this trade and more in 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
Significance
Bearish Invalidation
30min
1.6349/55
38.2% Fib / 61.8% Ext / Last Weeks Lows
Break Target 1
30min
1.6393
50% Retracement
Break Target 2
30min
1.6435
61.8% Retracement
Break Target 3
30min
1.6483/97
38.2% & 78.6% Retraces / Weekly ORH
Break Target 4
Daily / 30min
1.6566/75
50% Retrace / Last Weeks High
Break Target 5
Daily / 30min
1.6600
Soft Pivot / Psychological Barrier
Break Target 6
30min
1.6650
61.8% Retracement
Break Target 7
30min
1.6705
Soft Pitvot
Support Target 1
30min
1.6298
23.6% Extension
Support Target 2
30min
1.6267
61.8% Retrace / NY Session Low
Support Target 3
Daily / 30min
1.6221
61.8 % Fib Extension
Bullish Invalidation
Daily
1.6153/78
50% Fib / 61.8% Ext / TL Sup (4/11/13)
Break Target 1
Daily / 30min
1.6002
100% Fib Extension
Break Target 2
Daily / 30min
1.5919
61.8% Retracement / November Low
Average True Range
Daily (20)
148
Profit Targets 34-37pips
*ORH: Opening Range High
*ORL: Opening Range Low
Other Setups in Play:
EURAUD Scalps Eye Channel Breakout- Bias Bullish above 1.5020
Scalping the GBPNZD Reversal- Bias Bullish Above 1.9753
NZDUSD Scalps On Deck- Watch 8300
Updated 2014 Scalp Targets- USD, EUR, CHF, CAD & Gold in Play
—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 a Live Scalping Webinar on Monday on DailyFX and Tuesday, Wednesday and Thursday mornings on DailyFX Plus (Exclusive of Live Clients) at 1230 GMT (8:30ET)
Interested in learning about Fibonacci? Watch this Video
Source: Daily fx
