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Best Practice: H4R vs H4T, A look of trending vs reversal on AUDNZD

All Reversal trades are still counter trend trades

Previously we were looking at AUDNZD with a opportunity for a reversal.

Why do we want to trade a reversal if it is still considered a counter trend trade? The answer is simple, a reversal if successful, can also be the starting point of a new trend which can potentially allow us to ride the trade for some time.

 

So let’s take a look at AUDNZD as a point by point analysis using the H4 charts.

AUDNZD - 4 Hourly Charts

AUDNZD – 4 Hourly Charts

 

  • Previous trend was Down
  • Following a Bullish expansion, a 1234 pattern was also formed. This pointed to a possible H4R.
  • H4R failed when price expanded down below the previous 3 weeks lows which fits the criteria of a BM.
  • Current week (Wk#9), look for price to retrace to previous resistance levels in the form of a 1234 pattern.
  • Take note, if price is to continue to be bearish, it needs to stay below the resistance levels.

UPDATED 12th March 2014 (by Jerome)

Price has since moved 100+ pips for this pair, look out for next support levels as areas to do trade management.

Next Support levels in AUDNZD

Next Support levels in AUDNZD

Last time, many things that I wanted were just dreams, now I see them as possibilities. I’m looking forward to own pent-house suite in Manhattan overlooking Central Park because forex trading with Tflow® makes it possible. Find me on Google+

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2 thoughts on “Best Practice: H4R vs H4T, A look of trending vs reversal on AUDNZD”

  1. Chiah Hang Dennis Eng says:

    Jerome,
    it seem that H4 1234 has formed and pt 4 is at the support as indicated. Do you see price continue to be bearish after breaking 1.0680?

    Dennis

    1. Jerome Lee says:

      Hi Dennis,

      If price can go below 1.0650, chances that it continues down will be higher.

      At the moment, price is not moving much as #aud and #nzd are both strong so its a waiting game for now.

      Regards,
      Jerome

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