Monday, June 11, 2012

NZDJPY Trade Opportunity

Last week, nzdjpy closed above two its previous two weeks high, signifying a potential reversal. However, we needed price to retest the support first before we concluded that the reversal has happened.

Notice how nzdjpy ended the week at 61.18.

In H1, we see how price retested the support level (green line) and bounce off almost instantly without much struggle.

Using fibonacci, we confirm that it was a confluence zone where price was likely to turn.

However, a counter trend trade is usually harder to spot and probably takes longer too. Let's look at D1 to see if nzdjpy has a reason for a reversal.

It appears that the current low made was a month support as seen in the above chart. Seems like a good  explanation why this pair has reverse. Trade this pair carefully! It possess a higher risk but I'm sure the risk to reward it good enough. With sound money management strategies, you should do fine.

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