NZD/USD: Volume Profile and Price Action Analysis

Hello guys,

in today’s day trading analysis I will talk about a strong Resistance that has formed of NZD/USD.

Last Wednesday, there was an FOMC meeting (macro news) which caused huge movements across all the Forex pairs. Mostly USD-related pairs. One of those was also the NZD/USD.

Before the news, there was a rotation – calm before the storm. After the news came up, there was a strong action – a sell-off.

This tells us one important thing: Big institutional Sellers were building up their positions in that rotation. Then they pushed the price aggressively downwards.

Volume Profile Analysis

If you use my Flexible Volume Profile and check out the area before the sell-off, you will see the massive volumes that got accumulated there.

Those volumes should work as strong Resistance in the future. Strong Sellers won’t let the price go through this area without a fight, because this area is very important to them. Why? Because they placed a lot of their Sell orders there.

This setup is called the “Volume Accumulation Setup“.

NZD/USD; 30 Minute chart:

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Weekly Point Of Control (POC)

Another important thing to notice is that the Resistance zone which begins at 0.7134 is also the Point Of Control (POC) of the previous week.

This means that the heaviest volumes throughout the whole previous week got traded there. Simply put – this was the most important area last week.

This adds strength to the Resistance I showed you.

Weekly POC is by itself a very strong level which you should always be aware of in your trading.

NZD/USD; 60 Minute chart:

I hope you guys liked my analysis! Let me know what you think in the comments below!

Happy trading,

-Dale

1 Comments

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