Hi traders, here I have an opportunity to go short on NZDCHF
. My reasoning for this SHORT trade is that price is approaching resistance at around the 0.67400 level. Here we are already seeing price rejecting that level off of the 4 hour chart. I also placed the FIB extension on the DAILY chart
and see that the resistance level
that price is currently testing is also between the 50 and 61.8 Fib Levels. Also my last sign on confirmation is that both RSI
Oscillators are showing that the pair is in OVERSOLD territory. I will wait for the market to open tomorrow on Sunday to see further price action and to also wait till my broker's spread is lowered but if price keeps rejecting this level I will be entering short most likely Sunday night or Monday Morning. If I do go short I will be targeting the next area of support at 0.65900 for a total target of 140-150 pips and my stop loss would be a little above the resistance level
for about 30 pips giving me a nice 1:5 Risk Reward Ratio. Now if price breaks above resistance I will, as I have drawn above, wait for the retest of the broken resistance now turned support and go long. Hopefully my analysis of the chart explains it all. Thanks for reading and happy trading!