Hi Traders! NZDCAD short term forecast update and follow up is here. On March 8th 2023 I shared this “NZDCAD 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 Home Trader Club. Spoiler alert – free memberships are available!
My Idea
On the H4 chart, we could see that the price which was moving higher has created higher highs based on the MACD indicator, which is a sign of gaining momentum towards the bullish side. Currently, it looks like a correction is happening in the form of double wave down. Also, we have a key support zone that has formed based on the 100%(0.83377) Fibonacci expansion level of the daily first wave and the 100%(0.83450) Fibonacci expansion level of the H4 first wave. So based on all this, until the key support zone (marked in blue) 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.
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 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. The price then moved higher further as I expected it to and delivered around 200 pips move to the upside until it was blocked by a bearish divergence.
On the M15 chart, the market provided us with various facts supporting the bullish view. The price which was moving lower created a bullish divergence between the first low that has formed at 0.83965 and the second low that has formed at 0.83792 based on the MACD indicator. The price then moved higher and broke above the most recent downtrend line, we may consider these as facts provided by the market supporting the bullish view. Then as you can see in the image below how the price moved higher after that and provided a nice move to the upside.
(Note: You can learn about a Killer Forex Strategy “Double Trend Line Principle” here)
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 NZDCAD short term forecast is yet another good example of this scenario.
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If you have any further questions, don’t hesitate to drop a comment below!
Happy Trading!
Arvinth Akash
Home Trader Club Team.
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