News Column

Breakout or Break Down? NZD/USD Eyes Critical Resistance Pre-NFPs

June 5, 2014

Michael Boutros

Talking Points



  • NZDUSD testing Fibonacci / channel resistance
  • Monthly opening range set between 8400-8500
  • Major Event Risk on tap from US tomorrow



    NZDUSD Daily Chart

    Breakout or Break Down? NZD/USD Eyes Critical Resistance Pre-NFPs



    Technical Outlook



  • NZDUSD at near-term resistance confluence 8500/15
  • Breach targets topside resistance objectives 8583/90, 8634- bearishinvalidation
  • Interim support at 8410/15
  • Support break targets key objective at 8328/59- bullish invalidation
  • Daily RSI resistance trigger break- bullish
  • Major Event Risk Ahead: US Non-farm Payrollstomorrow





    NZDUSD Scalp Chart

    Breakout or Break Down? NZD/USD Eyes Critical Resistance Pre-NFPs



    Notes: The pair is testing resistance ahead of tomorrow's US employment report and the near-term focus remains on the 8500-handle. The level is defined by the 38.2% retracement of the 2014 range, the April lows and operative trendline resistance off the yearly high. Note that while we have technically broken above the weekly opening range high, we will look for validation tomorrow with NFP's likely to offer a catalyst. A topside breach of this level sets are bias on a more constructive approach heading into June against 8400.





    * It's extremely important to give added consideration regarding the timing of intra-day scalps with the opening ranges on a session & hourly basis offering further clarity on intra-day biases.



    Key Threshold Grid



    Entry/Exit Targets

    Timeframe

    Level

    Technical Relevance

    Bearish Invalidation

    Daily / 30min

    8515/19

    100% Ext / April Lows

    Break Target 1

    30min

    8545

    38.2% Retracement

    Break Target 2

    30min

    8565/70

    Monthly Pivot / Soft Resistance

    Break Target 3

    Daily / 30min

    8586/90

    50% Retrace / 61.8% Ext / 50MDA

    Break Target 4

    Daily / 30min

    8634

    61.8% Retracement

    Break Target 5

    Daily

    8676

    4/10 Close / 2013 High









    Support Target 1

    Daily / 30min

    8496 - 8500

    Weekly ORH / 38.2% Retracement

    Support Target 2

    Daily / 30min

    8475/79

    Soft Support / 100DMA

    Support Target 3

    30min

    8450

    61.8% Ext

    Bullish Invalidation

    Daily / 30min

    8410/15

    50% Retrace/ 1.618% Ext / Monthly ORL (8400)

    Break Target 1

    Daily

    8357/64

    S1 Monthly Pivot / 38.2% Retrace / 200DMA

    Break Target 2

    Daily

    8328

    61.8% Retracement









    Average True Range

    Daily (20)

    55

    Profit Targets 14-16pips









    *ORH: Opening Range High

    *ORL: Opening Range Low



    Other Setups in Play Heading into NFPs:



  • USDCAD Risks Reversal Ahead of NFPs- 1.0950 Key Resistance
  • EURUSD Targets 2014 Lows Ahead of ECB/NFP- Opening Ranges in Focus
  • AUDNZD Testing 2014 Range Highs- 1.09 Key Resistance
  • GBPUSD Scalps Selling Rallies into May Range Lows- Key Support 1.6750
  • GBPNZD Scalps Target May Opening Range Break- Bullish Above 1.96
  • AUDUSD Scalps Target Channel Break- Bearish Sub 9300
  • GBPAUD Scalps Target Key Resistance- Bullish Above 1.7920




















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    Source: DailyFx


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