Will support remain intact or will it break? That is the vital question right now as the pair is trading around the key support at .9600. If support gives way, look for the pair to fall to the next major support around the .8100 psychological level. However, if .9600 holds, we could see price rally to the top the pair’s highs again at 1.0500.
Are you looking for a quick trade? Check out this setup on NZD/USD! As you can see, price is currently in consolidation mode as it is trading within a tight 50-pip range. Watch price action carefully because any catalyst can cause the pair to breakout either upwards or downwards. A break up could lead to a test of former highs at .8160 while a break out to the down side could lead to a test of the .8000 major psychological level.
If you’re more into retracements, then perhaps USD/JPY is a better pair for you to trade. The pair, after testing the 103.50 region, has fallen back to 101.00. It’s currently testing the 38.2% Fibonacci retracement level, and from the looks of it, the bulls are starting to buy the pair again. The Stochastic is even showing that the pair is probably coming out of oversold conditions. If the bulls continue to jump in, we could see the pair skyrocket to 104.00 and possibly beyond!
To get the complete picture and avoid getting blindsided by economic data, you also have to do your fundamental analysis.
Lucky for us, Pip Diddy fills us in on what we need to know about fundamentals with his Daily Forex Fundamentals.