Started from the bottom now we're here - new yearly high target hit!
"A close above the 1.62500 could be a confirmation of bulls to continue even higher and after we see a retracement lower then make another move higher back towards yearly highs as a long term target."
After last week’s article on this pair and what has transpired since it is only right we update!
On my chart we can see to entries with my directional arrows shown. At the end of June our community were made aware of the short trade opportunity and we achieved +500 PIPS in the short trade, holding from the highs down to the lows created on the 22nd of July.
From here again the community was updated two days prior to the long opportunity that was about to come as we waited for the set up to present itself to us, being ahead of the market and many retail trader’s, knowing what the next move was going to be.
From here we had a impulsive move to the upside where we gained another +300 PIPS at the point of writing on my last article. This article stated we had now reached a resistance level at 1.6250 and from here we should expect a pull back before moving higher and if we were to break above 1.6250 we were then on track to attack the yearly highs set in January and take these out to create new highs in accordance with market structure.
As shown on my chart price action did just that, with a 150 PIP move to the downside from my resistance level of 1.6250 and then the rocket from two weeks ago refuelled and took this pair to a new space….creating the new yearly highs!!
We are now at a very important level for this pair, we are in new territory and how price acts from here needs to be monitored closely. The Euro has seen increased bullishness since the European central bank meeting on the 25th July and the NZD has seen a huge two-week decline, helping this pair meet the new levels created.
Now that we have created new highs and have no immediate resistance levels above us there is scope for this pair to move even higher, with even 1.7000 being the next real point of resistance which is another 400-500 PIPS higher than current price. However, we have also tapped the August 2015 high sitting just above our 2019 high 1.6580 so this level is a very strong monthly resistance. I expect to see another pull back from current levels at least that we can see has begun already today.
How far can we retrace to? Immediate support is around 1.6420 and then back to the 1.250-1.6300 level. Monitoring how price reacts to today's resistance will be key for the next move to determine if the bulls have run out of steam and if the bears can step in to take control.