While GBPNZD is clearly in an uptrend, I think there is an opportunity to profit from a potential downward move in the short term. As it can be dangerous to trade against the trend, we want to use a tight stop around 1.975 as a move past this point could mean a continuation upward. I see a potential for a move down to 1.95 and will look to take profits around this level.
Trade closed: stop reached:
Unfortunately, this trade didn't go as expected and our stop was hit, which fortunately minimized our potential losses. Even though this trade didn't go the way I wanted, this should be an important lesson about the use of stop-losses on all of your trades.