We had a profitable trend reversal trade on EURUSD last week and we ended up closing on that trade slightly above+2R. Hope you guys were caught that trade. In addition to trading on EURUSD, there was not much available for the past week.
Read last week trade analyze – EURUSD Will Price be Able to Break the Previous HL
But the upcoming week is going to be a little exciting since we already had two profitable trade setups align on AUDNZD and NZDUSD.
NOW… Let’s take these two pairs and see how we are going to trade AUDNZD and NZDUSD.
Disclaimer: Trade Revenue Pro’s view on the Forex Charts is not advice or a recommendation to trade or invest, it is only for educational purposes. Don’t Blindly Buy or Sell any Asset, Do your own analysis and be Aware of the Risk.
Keep in mind, These are Just Market Predictions and not a Trade Signal or Trade Ideas, At Trade Revenue Pro We are Using Daily Time Frame to Identify Major Price Movements and Push Down 4-Hour Time Frame to Get Favourable Risk to Reward For Our Trades, Furthermore, We are Using Tight Risk Management Method to Preserve Our Trading capital.
Key Level – As the above chart showed, Right now AUDNZD is trading around 1.06666 key level which comes from the daily chart and this level had tested on multiple occasion in the daily chart. This increase the value of this level.
Trend Structure – As you can see, with a sequence of LL (Lower Lows) and LH (Lower Highs), AUDNZD is in a strong downtrend. But as price approach to the 1.0666 daily key levels, trend structure starting shows weaknesses. The first trading factor here is that price stops creating LL and starts to generate higher lows that show the buying pressure building on AUDNZD.
Trendline – We now recognize that the trend structure is shifting, and we also affirm the trend reversal if the price breaks above the trendline.
RSI Divergence – RSI also showed Divergence at the 1.0666 daily key level. This indicates the lack of selling pressure at support level marked in the chart.
Market Forecast – First we identified the key level which comes from the daily chart. This is the main and first trading factor we built this trade idea around. Next, we had both Trend Structure and the RSI divergence indicating the same thing – Buying pressure build on AUDNZD. So with that all trading factor in mind what we can expect from AUDNZD. Well, if price break above the marked structure level which is also previous LH the whole market behaviour is going to change and we can expect a bullish movement. But if the price continues to move down after retesting trend line or the structure level, then we can expect a continuation in the bearish direction.
Trade Idea – If the price break above the local structure level, we will look for a retest of the structure level to execute the trade. As a take profit, we’ll use 1.07211 level.
Key Level – It is clear that price action starting slow down after reaching to the resistance level at 0.66843 which is coming from the daily chart. As a result of this lack of buying pressure price action ended up forming a rising channel.
Rising Channel – Have a look at the strong bullish momentum seen in the chart first. Buyers were very powerful at the time and tried to drive the price upward, but when the price met the resistance level of 0.66843, their control over the market was lost and a rising channel was created as a result of that price behaviour. This indicates the lack of buying pressure and as a result of that we can expect a trend reversal on NZDUSD.
RSI Divergence – Just like the previous confluence listed above, The RSI divergence also indicate the lack of buying pressure and this is another plus mark for our trade idea on NZDUSD.
Market Forecast – At the moment all the trading confluences are indicating the lack of buying pressure and how we are going to utilize this trading confluence. First, have a look at the marked blue zone which the local structure level. If the price falls down this level price action ended up forming a head and shoulder pattern this is an additional trade confluence for us. After price continues to move down and break the local structure level, then it is a clear sign of a trend reversal.
Trade Idea – Right now all we need is a break below of the local structure level. If that happens we will wait for a retest of the local structure level to enter the trade by targeting 0.66065 level (Green line on the chart).
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