Hi Traders! NZDUSD short term forecast update and follow up is here. On June 8th 2023 I shared this “NZDUSD Technical Analysis And Short Term Forecast” post in our blog. In this post, let’s do a recap of this setup and see how it has developed now. If you would like to learn more about the way we trade and the technical analysis we use then check out the Home Trader Club. Spoiler alert – free memberships are available!
My Idea
On the H1 chart, we could see that the price which was moving higher has created a bullish trend pattern in the form of three higher highs, higher lows, we may consider this as evidence of bullish pressure. Generally, after a bullish trend pattern, we may expect corrections and then potential continuation higher. Currently, it looks like a correction is happening. Also, we have a key support zone that has formed, based on the 100%(0.60302) Fibonacci expansion level of the first wave of this correction and the 50%(0.60479) – 61.8%(0.60331) Fibonacci retracement levels of the bullish trend pattern. The price which was moving lower, reached this zone, respected it and is currently bouncing higher from this zone. So based on all this, until the key support zone (marked in green) shown in the image below holds my short-term view remains bullish here. If we get a valid breakout above the most recent downtrend line we may then consider it as a validation for this short-term bullish view and may then expect the price to move higher further.
NZDUSD H1(1 Hour) Chart Current Scenario
In this pair my short term view was bullish and I was expecting the price to move higher further until the key support zone holds. Also, I mentioned that “A valid breakout above the most recent downtrend line would be the validation for this short-term bullish view”. The validation for the short term bullish view which is a valid breakout above the most recent downtrend line happened here as per the plan. We then had a small pullback with the price retesting this breakout and most importantly there were no signs opposing this short term bullish view. The price then moved higher further as I expected it to and delivered 160+ pips move to the upside as you can see in the image below!
So traders, when it comes to trading, there are various important factors that we need to pay attention to, just because we have a good setup doesn’t mean that we can enter the trade randomly and it will pay us huge profits. First of all, we need to validate the entry and we should have a perfect entry plan to get into the trade which is a key factor when it comes to trading. This NZDUSD short term forecast is yet another good example of this scenario.
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Happy Trading!
Arvinth Akash
Home Trader Club Team.
