Our NZD/USD Signal
Skerdian Meta • 2 min read
A while ago, we opened a buy forex signal in NZD/USD. The US Dollar has been suffering in the last couple of weeks and today we saw another wave of USD selling, so going with the trend makes sense right?
The trend is important, but we can´t rely on the trend alone. As you can see on the H1 forex chart, the stochastic indicator was well oversold a couple of hours ago when we opened this forex signal.
Besides that, the moving averages were in favour of our position as well. The 50 moving average (50 SMA) in yellow was keeping the sellers at check since they had been failing to break below it for a couple of hours.
That wasn´t all, though, a number of higher timeframe SMAs were clustered just below the 50 SMA, which would add more strength to that level.
It´s hard to trade when the strongest air turns to be the weakest all of a sudden.
The price action was also favouring us. There was some sort of retrace in most major forex pairs during the morning, but the retrace in NZD/USD was the shallowest. The Kiwi was showing the most resilience, which means that when the retrace was over, this pair would be the first to move higher.
That was the logic behind this forex signal, but less than 2 hours later, NZD/USD buyers don´t seem so confident. The retrace seems to be over in most forex majors, apart from NZD/USD. It has lost another 30-40 pips in the last hour while the other majors have been consolidating.
The currency which was the strongest against the Buck in the last few trading sessions turned to be the weakest all of a sudden. Well, there´s always this degree of uncertainty when trading forex, which might send perfect trades in the opposite direction at any time. We have accepted these unfortunate events when we entered this business. This forex trade is not over yet, though, so let´s hang on a while longer.