Silver forming head and shoulders pattern – Forex trading reversals on NZD pairs [Video]
|In today’s Market Outlook, let’s take a look at Forex Trading on NZD/CAD, NZD/JPY, Silver, XAG/USD, the NASDAQ, WTI, and Brent Crude Oil.
Last time we spotted a short trade on Brent Crude and WTI, and look what happened.
Are there more opportunities?
Yes, price fell after price action reached the upper trend line and the stochastic oscillator turned down from overbought.
You will also note that it opened with a price action gap on Monday morning.
Very often, price action gaps are filled during the same day, and they can be part of a good strategy.
If we move out to the 4-hour chart, we see a symmetrical pennant forming, so we could see a breakout soon.
We see all the major US indices like the NASDAQ and the S&P500 in a pullback, so are we looking at buying the dip?
If we look at the daily chart on the NASDAQ,for example, we see price action at the lower trend line and the stochastic oscillator heading into oversold territory.
If you look at other indices, you will find similar situations and you will see oversold technicals on lower time frames as well.
The RBNZ lowered their interest rate by 0.25% and look what happened.
If we want to take advantage of the NZD weakness, we will look for potential reversals WITH the trend.
The issue is finding a pair in which NZD is stronger, and we can’t find one, to be honest.
NZDCAD has a range trading flavour to it, and NZDJPY was in an uptrend but that is fragile now.
Regardless, ensure that you have some confirmation before you trade based on a possible stronger NZD.
We had been watching a range trading opportunity on silver and, finally, price action broke out and continued higher.
Now, we may be witnessing a reversal with this head-and-shoulders pattern.
If price breaks below this support zone, we have a long way to fall.
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