It looks like the decline of the Kiwi continued from last week and aiming 0.695 critical support level. The drop from the 0.784 top so far looks like a three wave pattern. Funny thing is that above 0.695 I cannot rule out the correction because the Fibonacci 161.8 expansion level (usual expansion of a wave 3) is right there.
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NZDUSD - Daily chart |
Last Friday's price action looks like a nice pause on the daily time frame. The bulls failed to make a reversal. Yesterday there was bearish slingshot momentum configuration setup on the 1 hour chart, which was followed by a nice signal candle. The slingshot was a strong 8 candle setup and occurred in lower blue zone which is the first support zone in a bear trend.
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NZDUSD - 1 hour chart |
This setup offered high return with low risk. I opened a
short position at 18:18 (GMT+2). EP was @ 0.7133 Sl was 0.7149 (above
the left leg of the slingshot). My first target zone is 0.701. This is
very I plan to scale out 1/3 of the position. If the decline continues
to the 0.695 support level I will scale out another 1/3 of the position.
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NZDUSD - 4 hours chart |
The higher time frames also supported this bearish setup. The momentum
of the 4 hours chart reached the sustainable bearish zone and pull back
only pushed the RSI up to the first bearish support zone. After the
setup got triggered the market kept declining and reached a new low. I
pulled my Sl lower to 0.7115 which is just a little bit below of what I think
is wave [1] of (v) of [iii].