A Trading Plan for NZD/USD
We have an open signal in AUD/USD which we opened last Friday as this pair was putting a bullish retrace after it had traded on a bearish trend the entire week. But, the situation changed for the USD this week as it put a decent bullish retrace on the higher time-frames.
Although, the commodity Dollars aren’t making the best of it given the weakness in the USD this week. AUD/USD has mostly traded sideways this week, which counts as a retrace. But, since commodity Dollars are not at their best shape, we have to be happy with the side-way trading and consider it as a retrace.
The NZD has been the weakest of the commodity Dollars and NZD/USD is around the opening level for the week. In fact, this pair has traded inside two moving averages this week and we are planning to use these moving averages to trade NZD/USD.
As you can see from the H4 chart above, the 100 SMA (green) has been providing support this week, although it hasn’t exactly worked exactly to the pip. On the top side, we have the 50 SMA (green) which also hasn’t worked to the pip but it has provided resistance nonetheless.
NZD/USD has also formed a resistance level above the 50 SMA at around 0.69. The price is headed up for the 50 SMA now and the stochastic indicator is climbing towards the top of its window, so it will soon be overbought, probably when the price reaches the 50 SMA.
That would be the time to get in on this trade and open a sell forex signal here before the price starts to reverse back down and head for the bottom of the range again at the 100 SMA.
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