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NZD/USD bulls got busy this week after hitting bottom at the .7100 zone.Will their party end at .7200? As you can see, the pair is having trouble making new highs at the major psychological handle. Of course, it doesn’t help that .7200 lines up with a 50% Fib retracement and the 200 SMA on the 1-hour time frame.
Shorting at the first signs of bearish momentum is a good idea if you think that NZD/USD will go back to its downtrend since late February and revisit its March lows.
Meanwhile, Kiwi bulls can wait for a clear break above the Fib levels and maybe even a bullish SMA crossover before eyeing previous highs near .7300 and .7400.
In case you missed it, GBP/CAD broke an ascending channel support earlier this month.But the bulls couldn’t be tamed and now the pound is back at the 1.7575 zone!
Are we looking at a break and retest setup? Shorting at current levels would yield a decent reward-to-risk ratio especially if GBP/CAD drops back down to its 1.7480 lows or even extends its March downswing.
A clear break above the SMAs and the broken trend line, on the other hand, would point to GBP/CAD not being over its longer-term uptrend.
Bulls can wait until the pound settles above the broken trend line support before aiming for inflection points like 1.7650 and 1.7825.