The NZDUSD pair broke higher during the day on Tuesday, clearing the top of the hammer that formed on Monday.

While this is normally a very bullish sign, there is a significant amount of resistance above at the 0.73 level, and also the 0.74 handle.

A shooting star or some type of exhaustive candle after a rally is reason enough to start selling, and as a result that’s what I’m waiting for as I don’t really see any other play, with perhaps the one exception being a break down below the bottom of the hammer on Monday which of course would show a pickup up momentum to the downside.

Editor’s Note: Equity investors/traders can use the Currency Shares Australian Dollar Trust (FXA, quote) ETF to take positions in the Aussie dollar without a FOREX account.  The ETF looks to track the price of the Aussie dollar (AUDUSD), minus ETF fee. The fund seeks to reflect the price of the Aussie dollar (AUDUSD) with the shares representing a cost-effective investment relative to investing in the FOREX market.

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