Aaand I’m in! My GBP/NZD buy stop order just got triggered but I’m a bit worried that the pair is still stuck inside a rising wedge forex chart pattern. Now what?
If you’re wondering what this is all about, make sure you read my initial GBP/NZD forex trade idea first.
As you can see from the chart below, price is gradually climbing but is also consolidating while traders are waiting for breakout catalysts. While there are no top-tier reports lined up from the United Kingdom and New Zealand this week, I’m thinking that the path of least resistance is to the upside, thanks to diverging monetary policy biases between the BOE and RBNZ. Data releases from both economies last week do support these biases anyway.
I was able to enter a long position at 2.3000 with a wide stop at 2.2700 and an even larger profit target at 2.5000. I couldn’t really spot a nearby resistance level on the 1-hour and 4-hour charts so I zoomed all the way out to the weekly forex time frame. From here, I saw that the pair is in the process of filling the huge gap it made since 2009!
Of course I’ll be making trade adjustments along the way by trailing my stop or even adding to my position if the bullish momentum gets stronger. Do you think this is a reasonable target or am I being too ambitious? As always, I’d love to get your feedback on my ideas!
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