GBPNZD Forecast Update And Follow Up

Hi Traders! GBPNZD forecast update and follow up is here. On May 25th I shared this “Technical Analysis – GBPNZD Forecast” post in my 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 Traders Academy Club. Spoiler alert – free memberships are available!

My Idea:

On the H1 chart, the price which is moving lower has created a bearish trend pattern in the form of three lower highs, lower lows which we may consider as evidence of bearish pressure. Generally, after a bearish trend pattern, we may expect corrections and then further continuation lower. Currently it looks like a correction is happening. In addition to this, the price has created lower lows based on the MACD indicator which is a sign of gaining momentum towards the bearish side. Also, we had two strong support zones that has formed and the price which is moving lower has broken below these zones and is holding below them, we may consider this as yet another evidence of bearish pressure. Currently, these strong support zones are acting as strong resistance zones for us. Until these two strong resistance zones (marked in red) hold my view remains bearish here and I expect the price to move lower further.

 

GBPNZD H1(1 Hour) Chart Current Scenario

Based on the above-mentioned analysis my view was bearish here and I was expecting the price to move lower further until the two strong resistance zones hold. The price action followed my analysis exactly as I expected it to here. After the bearish trend pattern the price which was moving higher reached the first strong resistance zone, respected it and moved lower from this zone. We also had a bearish hidden divergence that had formed between the first high that has formed at 1.95563 and the second high that has formed at 1.94379, followed by a continuing bearish divergence based on the MACD indicator which we may consider as facts provided by the market supporting the bearish view. The price then moved lower further as I expected it to and delivered 350+ pips move!
So, traders, this is why I wanted to show this example to help you understand how important it is to follow the facts. The facts were supporting the bearish view here and there were no signs against it. When the facts do happen as we expected you can see how the price perfectly moved as per the plan. Because these are the kind of hints the market provides us at majority of the times and it’s our obligation as traders to be able to listen to these things that the market tells us and we should try to make the right actions accordingly.

Not sure how to enter a trade? Spot reversals (bounces)? Not sure how to spot breakouts?

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Happy Trading!

Arvinth Akash
Traders Academy Club Team.

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