Range for the day, stays in the range....
If you look at the trading range for the day, the NZDUSD peaked at the recent highs. The low stalled at what has been a recent floor going back to December 20th. Over the last 11 or so trading days, most of the action has traded between 0.6974 and 0.6882 (on the downside). That is only 92 pips. Yes there was an attempt below that floor last week but it failed and subsequently reestablished the floor - as the floor.
IN between the two extremes is an area where the market has defined bullish above and bearish below. That comes around the 0.6924-33 area. Look to use that for bullish/bearish bias going forward and then the extremes of the Red Box as levels where traders should come in on dips and on extensions. Now.....at some point the Red Box will be extended outside the range. There will be a break.
Looking at the daily chart, the lower extreme will also have a trend line that cuts across and if broken - should solicit more selling. The caveat with that line is if if holds - and today and last week, the price got a sniff of the line at the lows - it can lead to a rally higher. There is more upside resistance - coming from the high in recent trading - but that too can work in the bullis favor if support holds.
So watch the price action from the hourly chart and it should show the way if there is a new momentum move in the near future.
