Forex Trade Review: GBP/NZD Double Top

Double whammy! I chalked up another loss on this GBP/NZD forex trade setup as price surged past the support-turned-resistance zone I marked on the 4-hour chart.

GBP/NZD 4-hour Forex Chart

GBP/NZD 4-hour Forex Chart

Thank goodness I only risked 0.5% of my account on my short entry at 1.9700 and I decided against adding to my position at 2.0000!

You see, as I mentioned in my GBP/NZD trade idea entry, I shorted at the worst possible price since I was afraid that I’d miss out on the entire move. I planned on adding on a pullback to the 2.0000-2.0100 levels to get a better average entry price, but I wasn’t able to get the confirmation I had been waiting for.

It seems that the bearish impact of the BOE’s shift to a more cautious stance has already faded on this pair, as New Zealand is facing its own troubles as well. Earlier this week, the Global Dairy Trade auction revealed another drop in prices, which might continue to weigh on the economy.

Here’s how my trade turned out:

P/L: -500 pips / -0.5%

With that, I’m looking at back-to-back losses with my previous EUR/CAD short trade so I’m really hoping to be able to bounce back! Got any tips?

Cheers,

Happy time

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  • ForExchange

    Hi Happy Pip!

    Sorry for your loss. If it was the second loss in a short period of time, I would suggest to leave this pair.

    What do you think on a CAD/JPY long play? I am looking at it.

    Good luck,
    FE

    • Yep, staying away from this cross pair for now seems like a good idea! I’m a bit wary of going long CAD because of Canada’s weak reports, then again Japan is faring worse. Might be a retracement setup forming later on.

  • Well this is a volatile pair so I thought a 500-pip stop would be enough to weather any wild swings.

  • Thanks for sharing your thoughts on this one! I must admit, I’m not an Elliott Wave expert myself since I try to stick to the basic Fib retracements and inflection points, but this one’s definitely worth looking at.

    Oh and thanks for the positive feedback on our site. See you around!

  • Yipes, looks like it wasn’t a good week for the comdolls then. Time to move on!