Yesterday was US bank holiday and as you expected, there was light volumes accompanied by modest daily average range. Also, as usual, normal trading resumes today as the market tries to find trend on Mondays. So, today we look at the fundamentals and especially today’s ISM non-Manufacturing PMI. You should keep in mind that over the last couple of weeks anything ISM had been released and it disappoints traders who always anticipate good data flow from the US to build their case and perhaps get convinced that rate hike is on the cards. Well, today’s expected ISM Non-manufacturing PMI will be no different, analyst expect a slight-almost close to negligible contraction from 55.5 to 55.4-check this release out at 1400 GMT, later we have GDT Price Index at a tentative time usually at around 1430 GMT. This biweekly release of Dairy products auction price is expected to nudge the NZD in either direction and so keep a close eye on that.
To the chart and today I choose to remain neutral with a bear bias based on the technicals. In my opinion, price action is trending cautiously around the resistance trend line and compared to Friday’s and yesterday’s high, price seems to be rejecting any level above 0.735. Also, the dailies indicate that we are approaching the top of a triangle with break above or reversal imminent. Looking at the 4HR and Daily charts, I still maintain a bearish move on the cards and that is why I recommend exercising patience as we wait to see what happens in the highlighted zone-check the attached 4HR chart-and then we decide from there where price might move to.
Trade plan for either case will be as follows:
Break above 0.735 zone,
Buy Limit: 0.727-around NFP’s highs
SL: 0.732
TP: 0.75
In case of a reversal,
Sell Limit: 0.73
SL: 0.736
TP: 0.705
Otherwise have a good trading day.

nzdusd 4hr chart-06.09.2016

Source: Dalmas Ngetich

nzdusd 15min chart-06.09.2016

Source: Dalmas Ngetich

nzdusd daily chart-06.09.2016

Source: Dalmas Ngetich

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