Forex Watchlist: EUR/NZD Long-Term Floor

I spy with my one good eye a reversal candlestick right on the long-term support of EUR/NZD. Will the bottom of this daily range hold?

EUR/NZD Trade Idea

This pair has sold off sharply in the past few days but it looks like the long-term range support is holding like a boss, with a spinning top to boot! The next few candlesticks are still showing a bit more hesitation so I don’t mind sitting tight and waiting for more confirmation, perhaps a bullish candle closing past the 1.5300 mark, before trying to catch this potential bounce.

EUR/NZD Daily Forex Chart

EUR/NZD Daily Forex Chart

Besides, market sentiment ain’t in the euro’s favor right now, as forex junkies can’t seem to stop buzzing about a potential extension of the ECB’s QE program past the March 2017 end-date. Euro zone reports, however, are suggesting that the economic picture has been improving.

For one, the latest batch of flash PMI readings from the region’s top nations have mostly been much stronger than expected. Updated inflation and growth figures are lined up from Germany, France, and Spain this Friday, and these should give a better idea of how the euro zone has been doing.

As for the Kiwi, RBNZ rate cut expectations for their November meeting could continue to keep a lid on the currency’s gains. Earlier today, New Zealand printed a larger than expected trade deficit of 1.44 billion NZD spurred by a whopping 5.7% tumble in exports. This was caused by a 35% decline in meat exports and a 1.2% reduction in dairy shipments.

I haven’t set any entry orders yet since I plan on waiting for a move past the 1.5300 near-term resistance before jumping in. I’m looking at the daily chart anyway, which means that I can afford to wait for a bit more momentum while looking at a potentially large upside up to the resistance at 1.5750 or at least until the middle of the range.

As always, don’t risk more than 1% of your account on a single trade and make sure you read our risk disclosure if you’re thinking of taking the same setups.

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  • Mark Dave Fercol

    Nice set-up as always Cyclops. I will also watch this one 🙂

    • Cyclopip

      Thanks for the positive feedback!

  • Cyclopip

    Huh. And I could’ve sworn I saw the notification with charts and all, right? That’s weird. I’m looking forward to seeing what you think so would you mind posting again?

    • Nazeem

      Yes it`s weird. I did not repost it, but see it is showing again?

  • cashfactor

    Thanks, have gone in long at 1.5300

    • Cyclopip

      I hope you were able to lock in profits before the drop!

  • Nazeem

    I`m still shorting. Don`t think it will reach target before RBNZ. I`m not really planning to trade the news and election spikes.

    • Cyclopip

      Looks like you were on point with this one! Did you keep it open?

      • Nazeem

        Yes I got in at 1.51579. I moved SL to break even at 30 pips in profit. It was at about 1.4888, 250 pips profit when I moved SL to lock in 100 pips. Keeping in mind that I am noob and this is my first election, I went to sleep after that. I got stopped out a few hours later. It was still a good trade and I am waiting for the market to calm down and then maybe get a better entry and follow the plan.