Price has dropped perfectly to our profit target. We now prepare to buy above 0.6847 support (Fibonacci extension, Elliott wave theory, horizontal support) for a push up to 0.6918 resistance (Fibonacci retracement, horizontal overlap resistance).
Stochastic (34,5,3) is approaching support at 5.6% level where we expect a bounce from.
Correlation analysis : NZD/USD has a strong postiive correlation with AUD/USD meaning they usually move together. Since both AUD/USD and NZD/USD are expecting bounces, this increases the conviction on our trade.
Buy above 0.6847. Stop loss at 0.6816. Take profit at 0.6918.
