Earlier during the week we were looking to buy valleys in the NZDUSD. Now, I think the pair is on verge of completing the current up-move. The pair is coming closer to major resistance levels, as can be seen in the daily chart below. There is also a down-move trend line waiting to push the pair down again. We also have a bearish hidden divergence on the daily chart. So, I think we should be looking for a sell opportunity in the short term.
Looking at the 4 hour chart of NZDUSD, the pair is coming closer to the duplication levels, as can be seen below. There are several resistances on the way up for the pair starting with the 0.8380/90 level. If the pair trades closer to these resistance levels, creates a divergence, and forms a bearish candle pattern, then we can jump into a sell trade. The higher the pair goes the better will be the sell opportunity.
Initial target should be around the 0.8260 level, and final target could be around the 0.8200/10 level. Stop should be placed above the 0.8450/60 level.
Reviewing yesterday’s events and trades
Yesterday, the US data again came as a disappointment. The US retail sales registered a 0.4% decline in the last month, and the core retail sales remain unchanged. The US jobless claims also rose to 339K from 331K. This caused a downside pressure on the US dollar. The pairs like EURUSD and GBPUSD are trading higher after the release. Earlier, in the Asian session, the Chinese inflation data was released, which registered a better than expected reading. This is boosting some of the pairs like AUDUSD and NZDUSD. The GOLD and SILVER are also trading higher after the release.
Fundamental Outlook for the day
Today, a lot of important data were scheduled during the European session. The Euro zone, German, French and Spanish GDP data were lined up. The growth outlook for the economy improved, and as a result the Euro bounced sharply. We need to be very careful while trading Euro pairs after all these important events. Later, during the NY session, the US industrial production data, the import price index and Michigan consumer sentiment data will be released. If the data misses again, then the US dollar may slide further. So, be careful friends, and try to avoid any risky bets ahead of the weekend.
This analysis is taken from today’s Daily Market Forecast, which also includes trade opportunities on: EURUSD, GBPUSD, EURAUD, USDJPY, USDCAD, AUDNZD and GOLD.
Get it HERE: Vladimir’s Markets Forecast
Have a nice weekend friends. Happy trading!
