FxWirePro: NZD/USD spikes but restrained as shooting stars appear on different timeframes – Short via futures and boundary options to speculate

On weekly charts, the NZDUSD’s bearish momentum has been intensified after drops below DMAs, likely to extend slumps as it breaches below major supports (0.7228 and 0.7150 levels) of amid any abrupt upswings.

The pair has formed shooting star candlestick patterns at peaks of 16-months highs which is bearish in nature (at 0.7318 levels on the weekly chart and 0.7282 levels on monthly terms).

As a result of the formation of this bearish pattern, the current prices have slid below 21-DMAs on weekly charts and attempting to slip below EMAs on monthly plotting.

Ever since the pair has rejected 16-months highs at 0.7485 and kept tumbling, attempts to slide below 7EMA (see monthly charts), Kiwi dollar seemed like exhausted at this juncture from the last couple of weeks but for now “Shooting Star” pattern occurred to signify weakness.

RSI and Stochastic oscillators on both weekly and monthly graphs are suggestive of further declines as they evidence downward convergence to the price dips, so previous consolidation pattern now seems to have exhausted at this level ahead of the central banks' monetary policy changes in both NZ and the US continents. 

While %D crossover at 80s which is overbought zone on monthly plotting have been convincing that the selling momentum is still strong. MACD is also substantiating the same as the downtrend likely to prolong.

Hence, considering above technical reasoning, one can eye on boundary binary options for intraday speculation and shorts in mid-month futures for the targets towards 0.6950 levels with the strict stop loss at 0.7182.

On speculative grounds, the boundary binary options strategy with upper strikes at 0.7122; lower strikes around 30 pips below 0.7080 levels.

For this speculative position, the leveraged returns are certain as long as the forward prices to remain between both strikes (i.e. 0.7122 > Fwd price > 0.7080).