Hi friends. Last week NZDCAD moved as expected and we held no drawdown for this trade, which reacted at OB. Trade is locked now with a sell.
If you are trading this with me, feel free to ask the levels to lock it again, opportunity to join buy trades at 0.9034 for a last higher high, and then, sells to 0.8709 first daily TP.
This week I want to share a couple of trades that look interesting. The gap that appeared last Monday in GBP pairs, which we warned beforehand in our FB group, Showed interesting things to comment.
Due to correlation, when we analyse for example GBPAUD we need to check the rest of the crosses, GBPNZD, EURAUD, GBPCHF, EURNZD… European pairs tent to repeat their behaviour with Oceanics. The expected gap that showed in GBP pairs have been closed in some pairs, like other Europeans.
EURGBP. Take a look at the 1H chart.
Let´s check now GBPCHF, EURGBP´s little brother, more than 90% inversed correlated with it, closed the gap as well and reacted at 4H OB also at the level. The extension guided price to the debt pivot and AO is showing a posible higher high. The opportunity to enter following our sequence with 5:1 RRR and minimum 300 pips.
That move closing the gap, called Vacuum Order Block found institutional orders and that´s why price rejected the gap with decision.
Other pairs like GBPUSD didn´t close the gap. We shared the trade and we were stopped with -40pips. We should look for levels to buy at discount.
Other interesting pair that didn´t close the gap was GBPAUD.
We have reasons to think that we could have a move upwards. Double AO divergence, even ignoring if we could have a new wave down after wave 4. seems logical that after 227FE we can trade to the Debt Pivot.
This is how lower timeframes show the behaviour of GBPAUD. Remmember that Vacuum OB we found in GBPCHF and EURGBP? It is likely that same strong rejection due to institutional limit orders, will appear also in this pair. This is my discount price to buy. This time, small trade size is a must, since SL is -120 pips. RRR is still more than 4:1 for TP1 and almost 7:1 for TP2. Those are confluence of OB zones with Aureal levels.
Any other idea, analysis, comment is truly welcome either here or in our FB page. Let´s trade carefully at discount areas these last 2 weeks of the year.