A few minutes ago, we opened a forex signal on NZD/USD. We went long on this pair, and the following is an explanation as to why.
There’s not much logic behind this trade- the trend here has been running up for more than a month, and such a trend is impossible to go against. It has picked up even more pace over the last few days, so it seems that we are on the right track.
The stochastic indicator is currently pointing up as well- t is oversold and is reversing higher, meaning that the retrace lower has ended, and the uptrend is about to resume. The retraces have been pretty small for this pair as of late, and this is how the dip of this latest retrace looked.
We bought a few pips above support
The area around 0.7530 was the high on Wednesday, and now this area has become a support. On the other hand, the low today was 0.7535. We went long just above there.
When the forex signal was opened, the price was below the 20 SMA (grey). But because of the buyers’ quick reactions, they have now taken us back above this moving average.
The previous hourly candlestick proved to be another bullish signal. It closed as a hammer (a reversing signal), following a trend. The intraday trend has been down since the early hours of the morning. But as we said, that’s just the retrace of the bigger uptrend. All indicators point up for this pair, which is why we went long.