NZDUSD Trading Setup
NZDUSD Trading Setup
Dear traders,
The trading setup from last time is playing with the stop at the moment. It looks like the price might be ready to test the next support level at 15.50. That is why I am more cautious with it. The price action is not really giving me a better idea and this makes me think about the major trend. Since we are in a bearish correction, maybe we should be more patient and wait until (if) the 15.50 is reached.
NZDUSD Trading Setup
Today’s trading setup is coming from the NZDUSD pair. There are a couple of fundamental factors to note before I proceed to the technical analysis bit.
- Draghi speaks at 13:00 GMT (indirect effect and building up a position before RBZ)
- Today is the day of the RBZ Rate Statement
Those two should make you reconsider where to place your stop-losses. I personally am considering a slightly wider SL. But before that, what do I see today:
Here is the 4H chart of the NZDUSD. As I have pointed out with the red circles, there are price action confirmation patterns. I am looking at all of the pin bars and bullish engulfing candlesticks around the support level. This is a confirmation that the support level is strong enough to hold so many attempts to break lower. I will be looking to go long at around 0.6885 or slightly higher depending on price action. My stop loss would be placed just under 0.6825. My first target is the resistance area at 0.7050.
Happy Trading,
Colibri Trader
p.s.
If you have not checked my latest trading psychology article, you can do so HERE
If you are interested to know how I trade in details, you can check it out HERE
If you have any questions- hit me up at: admin@colibritrader.com
Hi colibritrader,
I had this page open yesterday wanting to post my thoughts but I’ll do it today instead.
They are the same thoughts as yesterday.
I hope I can share my thoughts openly with you, I want to stress they are not meant to be anything but honest opinions on my part.
I was puzzled why you wanted to go long such a weak currency, plus the trend was down. Anything paired with USD has been weak. USDJPY is a good barometer YEN a safe haven of sorts and the USD keep gaining ground.
Now I’m not stating these facts after the fact, but there were better trades out there that “were” trending. USDJPY eg
I’ve taken note of these days before plus I am researching and leaning what makes certain pairs move. Trading charts signals
“with” trend is great but my thoughts are that taking counter trend moves without some fundamental consideration is not a good idea. I wanted to share with you that I was long gold and got stopped out. Went long @ 1226.
Trend was down and I went long, pretty much a fundamental mistake according to the colibri way.
In hindsight I forced the trade instead of looking for a signal inline with trend.
Apologies if I am out of line with my comments feel free to tell me if I am.
Regards
Hi Dan,
Thank you for the comment! That is how we learn in the end- more sharing, better learning. Actually, I think we are both partially right for this trade. I absolutely agree with you that it is against the trend but it was on a solid support zone. Price action was confirming it, too. In fact, I still believe that this last move is overexposed and am thinking that we might see a reversal day, where a pin bar or bearish rejection candle is formed. This is just my anticipation, so I will wait and see what will happen by the end of the day. Was not expecting to see a sudden drop, but yes- you are right fundamentals are important. Unfortunately, they are great if you are trading for the ultra long-term and probably not currencies. It will be easier to get the fundamentals right on commodities (because of cycles) and equities. Forex is probably the hardest to “predict” in the long-term. And I am not really keen on “predicting” anything. I just react on what I see and follow my own rules. Am I making mistakes- of course I am. This is part of the process of learning and improving and no matter on what level you are, you will keep on making mistakes and sometimes even silly ones. That is why money management skills are extremely important. As a conclusion, this is still not a bearish trade for me. I believe that the support level is still holding price and maybe that was the last leg down before a more steady direction is taken, but I guess the close of the day will confirm it. Just my 2 cents 🙂
-Colibri
Hi colibritrader,
I’m glad your not upset with me, I like to be honest about what I’m thinking and hope you will do the same for me when I post.
My wife stopped asking me a long time ago if her a$$ looks big in a certain dress
Well that was a joke as I value my life more than my thoughts in some exceptionslol
I’m watching silver and gold for any bullish action at key levels
Regards
Haha- your comment really made me laugh. I am actually glad you are honest- that is the only way to improve as traders and as human being… Please keep on being honest as I still believe NZDUSD has hit a bottom 🙂