jackomak
Long

NZDUSD Prepping for takoff?

FX:NZDUSD   New Zealand Dollar / U.S. Dollar
NZD/USD has recently moved higher in a strong uptrend and for the past few days/weeks has been consolidating in what could be the first pullback on the higher timeframe. Diagram shows the 4 hour time frame and shows price has bounced twice in the past off of a support zone (purple box). Current price action has just formed a Pinbar on the one hour (my entry time frame) but is beginning to form the same pattern on the 4 hour allowing for a perfectly valid entry to the long side.

I ideally would have preferred the pinbar shadow to cross one, or both off the shadows formed at the pivot points of the candles that bounced off of the resistance zone in the past. This would have caused more short sellers to enter the trade and would have potentially squeezed the price up higher. To accommodate for the chance the price may try to retest the lows and I have set a stop loss (red line) below the support zone to accommodate the chance of this occurring.

Though this entry may lead to an extended uptrend trend leg, I recommend taking most of your profits around the levels highlighted (green rays). as price has bounced twice in the past it is likely that current price action may reach these levels and return to test the support level again. Should the price action break through these pivot points whilst showing good momentum, it will be worth leaving some profits (I recommend around 25-33% of total position size) on the table for a shot at another trend leg.

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