NZDUSD Bat Action Magnet Move (BAMM) (1H)
NZDUSD is looking to complete a bat pattern, and we are looking to ride the expected rally from the C point of the pattern to its D completion. Known as a BAMM in Scott Carney's book, I have seen this short term strategy pay off with a high win rate. I have also completed the drawing of the bat pattern with its potential reversal zone (red rectangle), so we can look to short the market when and if it gets up there. I believe taking a long position after price crosses and closes above the B point and riding the rally to the pattern completion will work better with the higher timeframe analysis of this pair, seeing how we are currently in a bullish trend (on the daily chart).
Entry Price: 0.85700
TP: 0.86170
SL: 0.85500
Low risk trade with potential to make a small profit. Trade entry execution is very important on this low timeframe. As the price nears the B point, we need to watch price action, and make sure that it continues to look bullish. We cannot enter the trade without a break AND close above the B point price. We might watch the 30 or 15 minute chart to look for a small pullback AFTER the break and close above the B point, and then enter at that position.
UPDATE 10AM PST 3/25: Strong bullish candle. Wait for it to close, and observe price action to determine whether to buy now, or wait for a pullback into structure.
UPDATE 11AM PST 3/25: Involved in the trade. Will roll stops to breakeven once halfway to the target.
UPDATE: Easy winner. Hit targets. Expect the price to move into the red rectangle (PRZ) again before price should retrace to the downside. I would be more cautious of taking this bat pattern completion trade since it's going against the daily upward trend. If anything I would keep stops tight and targets close to the entry price.
UPDATE 3/27: Price action busted though the PRZ. Bat trade is invalid. Look for bullish trend continuation trades.
Entry Price: 0.85700
TP: 0.86170
SL: 0.85500
Low risk trade with potential to make a small profit. Trade entry execution is very important on this low timeframe. As the price nears the B point, we need to watch price action, and make sure that it continues to look bullish. We cannot enter the trade without a break AND close above the B point price. We might watch the 30 or 15 minute chart to look for a small pullback AFTER the break and close above the B point, and then enter at that position.
UPDATE 10AM PST 3/25: Strong bullish candle. Wait for it to close, and observe price action to determine whether to buy now, or wait for a pullback into structure.
UPDATE 11AM PST 3/25: Involved in the trade. Will roll stops to breakeven once halfway to the target.
UPDATE: Easy winner. Hit targets. Expect the price to move into the red rectangle (PRZ) again before price should retrace to the downside. I would be more cautious of taking this bat pattern completion trade since it's going against the daily upward trend. If anything I would keep stops tight and targets close to the entry price.
UPDATE 3/27: Price action busted though the PRZ. Bat trade is invalid. Look for bullish trend continuation trades.