Earlier today we opened a sell forex signal in AUD/USD and in about an hour, we opened another one in USD/JPY. Both of these forex signals are long on USD.
Yesterday, the USD started to make a comeback after a week of consolidation. The USD performed quite well against the JPY and the commodity currencies yesterday, so after a retrace lower overnight, the price in most forex majors reached some interesting support and resistance levels.
This is the perfect bearish chart setup to go short.
After the first two forex signals, the retrace lower continued a bit further for the Buck and NZD/USD reached the 20 SMA (gray) on the H1 chart. The stochastic indicator was oversold as well, which meant that this timeframe chart was oversold, so the retrace up seemed over.
Another reason for this last forex signal is the inability of NZD/USD to climb higher when the other majors have gained between 40-50 pips against the USD. That sort of price action shows that the NZD is among the weakest currencies so far.
So, we sold NZD/USD and at the moment the price is turning lower. The US producer inflation report was really positive about 30 minutes ago. The USD is gaining across the board, so let’s hang on to these signals.