GBPNZD Short Term Forecast Follow Up and Update

Hi Traders! GBPNZD short term forecast follow up and update is here. On July 14th I shared this “GBPNZD Short Term Forecast And Technical Analysis” 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 Traders Academy Club. Spoiler alert – free memberships are available!

My Idea:

On the H4 chart, the price has created a bearish divergence between the first high that has formed at 1.99282 and the second high that has formed at 1.99561 based on the MACD indicator. The price then moved lower and broke below the low at 1.98250 creating lower lows, thus forming a classical setup of bearish divergence followed by bearish convergence. Hence as per the book scenario, after a bearish convergence, we may look for possible corrections and then further continuation to the downside. Currently it looks like a correction is happening. So the bottom line here is that the H4 chart has evidences supporting the bearish view. Until the strong resistance zone shown in the image below (marked in blue) holds my short term view remains bearish here and I expect the price to move lower further.

GBPNZD H4(4 Hours) 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 strong resistance zone holds. After the bearish convergence the pullback that I was looking for happened but most importantly the price was holding below the strong resistance zone and then the price moved lower further as I expected it to and delivered 210+ pips move so far.
On the M15 chart the market provided us with various facts supporting the bearish view. The price which was moving higher created multiple false breaks with a bearish divergence between the first high that has formed at 1.98191 and the second high that has formed at 1.98329 based on the MACD indicator. The price then moved lower and broke below the low at 1.97912 creating lower lows, thus forming a classical setup of bearish divergence followed by bearish convergence. In addition to this, we also had a breakout of the most recent uptrend line and also there were no signs opposing this bearish view. We may consider these as facts provided by the market supporting the bearish view. Then as you can see in the image below how the price moved lower further and provided an amazing move to the downside.

(Note: You can learn about a Killer Forex Strategy “Double Trend Line Principle” here)
As traders we always have two choices, the first one is to fall in love with our analysis and try to convince the market and expect the price to move in the direction as per our wish. The second one is to follow the facts that the market provides us and make the right actions according to that. As you know the first option won’t help us and as you can see in the example above what happened when we followed the facts that the market hinted us and took the right action according to that.

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