Look at this chart. The price is bounded by the SD channel very well.
But it is pretty near the bottom of the channel. That could launch small uptrends that are counter trend the 4h trend lines.
Also you can see the triangle that pipcompounder is talking about in this other chart:
I think the break of the triangle is going to be down from what I’m looking. Downtrends on all the major time frames and also weak pound vs strong kiwi is the recipe to a strong down move when the bottom of the triangle is broken
We have indeed broken well below lows, and price is testing downward trendline now, so it’s a good time to sell.
If this does get below 1.85000, it will be an interesting ride, there should be a bounce, if it gets that low.
The problem with trend line trading is that you can usually draw them all over the place and if one is broken you just redraw it! It looks great in hindsight but doesn’t work to well live.
Yes, it is an aquired skill. You have to be patient enough to let the price develop a trend for several candles before you can draw a line. This pair historically respects a trendline, once it’s established. It has been going into this triangle, as previously discusssed, and appears to have broken out downwards. There is enough downtrend already established to draw a trendline connecting the highest high and the next highest high. I will have my sell opened until that is broken…my sell was at 1.89000, BTW…was waiting there from last week for the breakout. I had 100 pip loss also.
So, no one’s thinking it’s going to breakout long?
I’ve been snagging a few while it’s been ranging recognizing 1.8845 as a major resistance point right now. The MacFib strategy uses a 20 sMA and 5 EMA on the 1 hour. When the 5 crosses up, it’s a good long signal. I took 8 today so far, am waiting for the next move up.
That being said, it appears like over the last day or so that the lows have been getting higher.
Did anybody get in a sell in on GBPNZD as the price touched the trendline at about 1.89000?
It was a good time for that. If price comes up to trendline again very soon, be ready for a break to the upside, as on the hourly, we are seeing higher highs and higher lows, possible reversal. If price stays away from the trend line for now, then it should continue down. The pound is looking down more, fundementally, because Britain wants to cheapen their currency, and they’ve had a string of bad economic news. The question is, will the NZD likewise weaken, or rise?
I think I need to help you with this look at the big picture before deciding market direction. The big picture is 4h or higher. If you are looking higher highs WITH higher lows, then it is an uptrend, if it is lower highs WITH lower lows is downtrend.
If you are looking lower highs with higher lows is a triangle and you must avoid directional trading, if you see higher highs and lower lows is an inverted triangle and you should avoid trading at all unless you know well the fundamentals.
(you can help yourself with higher highs and lows and so with the zigzag indicator. THe default settings are OK for 1h or more, in 15m or less you should increase the extdepth parameter)
As a newbie (maybe not only a newbie) you should avoid trading countertrend.
Another tip is to look for smooth and nice trends. If you are looking this charts, which one shows you better trend?
Congratulations Pipcompounder on an excellent thread!! I too use very similar methods to yourself but also build in candlestick patterns and popular formations ( double top/bottom, head and shoulders etc). I have found that a trend line break followed by a retest that fails and is confirmed by an engulfing candle pattern has never failed. I use 4hr charts and daily charts. Iam now incorporating fibonacci on the next timeframe down after i have witnessed a trendline break. This has proved very useful in establishing if the break out has follow through. I have found success with GBP/NZD but also find GBP/CHF can be very good at trending. Unfortunately my stupid laptop will not allow me to post chart attachments but I am currently watching GBP/CHF that has been respecting a downward trendline for sometime. When you zoom out on the 4hr chart a possible double bottom is forming and I am looking for this to play out and then take out the trend line. I believe this will be an aggressive move should it confirm.
Test also eur/gbp, that should be almost the same as gbp/chf but inverted.
I’m trading eur/gbp right now in uptrend with very good results. 3 trades in, 2 with profit locked and profits of more than 200 pips and the third one still runing without locking profits with about 20 pips.
I think this will be a good trade! I am watching GBP/CHF, which is starting to confirm its double bottom on the 4 hr chart… I am looking for it to now break the down trend. I urge anyone looking at this trading style to watch the GBP/CHF very closely as the move could be aggressive.
Well, I moved my TP and ended up taking 22. Now I’ll wait to make sure the short term down trend is done before getting back in on the long - and I’ll probably wait til after the NZ trade reports (just in case it’s really good and sends this lower)
I may have entered the buy a bit soon. That’s what a stop loss is for.
I will wait a bit on this to see if price continues so steadily to drop, before trying to buy.
look at the big picture before deciding market direction. The big picture is 4h or higher. If you are looking higher highs WITH higher lows, then it is an uptrend, if it is lower highs WITH lower lows is downtrend.
