Transcript of Video
Hello everyone, this is today’s video analysis for January 29, 2019. Today we’re looking at the New Zealand Dollar versus the US Dollar [NZDUSD] for today’s trade analysis.
Starting here of course on the daily timeframe, a couple of different trends that we can really observe here on this timeframe. Previous uptrend going back to September, October of last year, we saw the market going up for a period of time through middle part of December. Then it turned back around; went back around. We saw that crash that caused the market to push all the way down here into 0.6555, and then we started turning back higher again for a short period of time back down, and then now back up.
So, trend-wise, when you’re talking about directional purpose here for the currency pair, a little bit difficult to discern because you really have seen all the directions, haven’t you? You’ve seen bearish. You’ve seen bullish. And there’s no real significant impact to direction. We could see both directions really in play.
Today we’re into resistance. Top of these two trend lines that I just drew. In fact, I’m going to take them off here and I’m going to draw a circle there. Right here into this green zone, we know the last time. This fact. This isn’t anything we can change. The last time we were here into the green zone, 0.6830, 0.6850, is that we found resistance and the market turned back around and went back down in this not really a significantly long-term trend environment we’re in, where we saw it rising. Found resistance; fell back down.
Now here we are once again into this green zone as resistance. We’ve seen this before. It’s nothing really new. I just take the black circle back here and you could see resistance. And if you look to the far left-hand side of the chart, the blue circle shows resistance here at the green zone as well.
So, we know there’s really two things to watch for here. Really I can bring the black circle right here and say this is the opposite of that, where it gets above and makes a new high. You could see that little candle body there inside the black circle getting above the green zone. So, there’s really two things we’re watching for today here on the NZDUSD. Either, like the black circle, it’s going to get above 0.6850 and continue the upside pressure towards the yellow zone or higher, or it’s going to hold the green zone and we’re going to see the turn back down to the blue zone or lower.
So, the green zone is our main area of focus for the day today. So, we’re looking for price action. We’re looking for clues and evidence around here that tell us what’s going to happen. Now, my preference if I was going to buy is that we’re looking for a candle body to get above that green zone. I need something to get above there; change the status quo to increase my confidence.
Look at the black circle. We saw a candle body get above and then it continued to pressure higher. So, that’s the change in the status quo that we need. 0.6850. We get a candle above there. Increases our confidence that it’s going to continue the upside pressure. I think the previous candle though is very interesting as well, implying that there are sellers here. There are sellers ready to take into a short here because we have the smaller body and long wick.
At one point, this was a very long bullish candle and then suddenly sellers dove back into the market and driving it back underneath 0.6830. So, there’s an implication here of selling pressure that is still lingering into this 0.6850, 0.6830-level, the green-shaded area. So, we need one of two things. We either need it to get above or we’re looking for further information of selling pressure.
The market gets back underneath 0.6830 and it tells us that there’s a potential that this continues to pressure back down to the blue zone or lower. And really that would be playing well within the hands of our current trend, wouldn’t it be, as we have seen it rising and falling up and down over the past several weeks. That wouldn’t be anything new to see this take a tumble down to 0.6770, 0.6755, the orange zone, or maybe even the pink zone again as our next support.
So, two things we’re watching for. Breakout above the green zone or reversal from there. Take it down to the four-hour timeframe. We did see indeed a candle body get above here on the four-hour timeframe. But as we look at there on the daily, it’s not really a legitimate breakout quite yet because the daily didn’t stay above the green-shaded area, 0.6850.
So, we’re looking for some daily confidence in here. Does it stay above? Does it get back below? Sudden infusion of sellers today back underneath. Green zone may give us confidence it’s going to go down. We had some significant news out of New Zealand yesterday as we saw the trade balance out of New Zealand. Came out positive. Better than expected. It was forecast at 225. Came out 264. Didn’t really change the status quo here. It didn’t change it back to the upside. It just kind of had a little bit of a range and now finding resistance again.
We know that significant US data this week may improve the chances of a longer-term trend here as well if the USD falls or rises. We haven’t seen much out of the USD yet this week, so kind of watching that four-hour next clue of direction here. Either a break above the green zone or reversal back under the green zone for the NZDUSD today.
From Forex Traders Daily, this has been your daily analysis with Ross. If you would like to get Ross’ analysis on all the currency pairs he’s watching and all the trades he takes today, join him in his live Trade Room by clicking on the link below. Please leave any comments you have about today’s video in the comment section below.