NZD/USD - Multiple Dojis Forming Leaving Uncertainty In The Market
Not much has changed with this pair since our last post on the 5th June 2018, where we had finally seen some bullish movement with a breakout to the upside which we had expected and explained would happen, heading towards the 0.7100 area.
We had seen price had then run into what was minor daily resistance at the 0.7050 level and price was showing some bearish signs that we may see a slight pullback, perhaps in the form of a Fibonacci retracement, before meeting the target of monthly resistance at 0.7100. Eight days later and we find ourselves in the same position as we have seen price consolidate ever since. A tight range of 50/60 pips with little signs of a break to the upside or downside has seen this pair basically come to a halt as we await the next move.
Within the range between 0.7000 (holding as support) and 0.7050 (Holding as resistance), we have seen multiple Doji candles showing there is clear indecision in this market at the moment. To place another trade on this pair patience will be needed to wait for a break out in either direction of the support/resistance to confirm the next move. As we have seen some false breakouts to the upside on my daily chart, care needs to be taken to not trade the break out to early, preferably waiting for a strong 4-hour candlestick close to confirming the intent as on lower time frame we may see the price pull back into the consolidation zone a create another wick overall on the daily chart.
Today we have seen price rebound from the lower barrier, printing lows of 0.6995 and taking a bullish stance as we now trade 40 pips higher at 0.7035. The 0.7000 level has now been retested three times in the past eight days and has held strong, also acting as the 61.8% Fibonacci support. Perhaps this is the third and final rejection as we make the push towards 0.7100?