NZD/USD ? at Key Support Either Bounce or Continue ?

3 min read
Adarwish

adarwish

Author

Hi traders,

NZD/USD developed a bearish momentum during last 4 weeks… It seems that this price action completed 5 bearish waves and now the correction of wave A is around the corner.

We will review different scenarios as the pair can either bounce for bullish correction or expand the bearish momentum of wave 5.

This article will discuss the wave perceptive and expected scenarios for the pair during the coming days using wave pattern, support, and resistance and SWAT software.

NZD/USD at key Support either bounce or Continue

As the below chart shows, the pair developed a strong bearish momentum… In my view, the pair now is in wave 5 and cloud end this last bearish wave soon at -27.2% Fibonacci level. The -27.2% Fibonacci level  is a key spot for confirming or invalidating the start of Wave A.

And here are the main conclusions:

  • I looking for a reversal signal around -27.2% fib level.
  • Reversal price action pattern will confirm the start of wave A.
  • if price break -27.2% fib level can expand wave 5 till -61.8% level.

For the moment I expect a new bullish momentum for wave A but we still need more confirmation before trading this pair… in the next paragraph, we will discuss this development by using SWAT software.

NZD/USD SWAT CHART

Now it’s time to use the SWAT 4-hour chart to determine the entry points according to the expected wave patterns… SWAT Chart shows bearish momentum but some developments to confirm the Bearish wave A starts… Here are the main developments to consider:

1. There is bullish divergence which makes upside more likely.
2. Waiting for the price to break the 21 ema with a strong bullish candle will be our entry.
3. Our target will be around 144 ema.
4. I advise traders always to protect their profit or use trailing stops.

So in my view, traders should wait for the confirmation before trading this pair and look for buy opportunity only as it matches the expected wave.

Good trading,

Ahmed
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