I have been focusing on the NZDUSD pair for the last couple of days, and as mentioned in the weekly forecast, I think the pair can re-test the previous highs. There is a bullish convergence on the daily chart, as shown below. So, I think every pullback may present us a buy opportunity.
Looking at the 4 hour chart of NZDUSD, there is an up-move trend line, as shown below. There is also a major support at around the 0.8220 level. I think if the pair moves lower and forms a bullish divergence on the 4 hour chart, then we can jump into a buy trade, as highlighted in the chart shown below. Remember, this scenario is valid as long as the 0.8220/00 support level holds.
Initial target should be around the 0.8400 level, and final target could be around the 0.8500 level, as shown in the chart below. As mentioned, the stop should be placed below the 0.8200 level.
Reviewing yesterday’s events and trades
The US retail sales data was released yesterday, which registered a better than expected reading. The Core retail sales jumped by 0.7% in the last month. However, the previous reading was revised down from 0.4% to 0.1%. The outcome was positive for the US dollar, as a result the pairs like GBPUSD, EURUSD and AUDUSD are trading lower. The EURUSD traded below the 1.3650 level, and the AUDUSD traded below the 0.8950 level. The NZDUSD too traded a touch lower after trading higher yesterday.
Fundamental Outlook for the day
Today we have the US Core Producer Price Index data to be released. The market is expecting a stable reading. The NY Empire state manufacturing index will also be released, which is expected to jump from 0.98 to 3.75. Furthermore, the Fed’s Beige book will be released, which can be important and bring some volatility in the market. The investors will be watching this event to know about the economic outlook. Other than this, the Australia’s employment data is also lined up in the coming Asian session, which can cause heavy movements for the Australian dollar.
This analysis is taken from today’s Daily Market Forecast, which also includes trade opportunities on: EURJPY, EURAUD, USDCAD, EURGBP, EURUSD and AUDUSD.
Get it HERE: Vladimir’s Markets Forecast
Trade safe friends. Happy trading!
