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Finally this big setup in EURNZD now in play

This very long significant support-turned-resistance was identified in January. We were looking at a high probability reversal then since there was a potential Head and Shoulders reversal pushed against a very significant level going back to as early as 2005.

This chart below was posted on 31 January 2018.

EURNZD monthly chart from 2003 - January 2018

EURNZD monthly chart from 2003 – January 2018 | Source: Tradingview.com

Unfortunately the much anticipated right shoulder dragged on and transformed into a very long triangle consolidation. If any trader had followed this setup with a short and stop loss order above 1.7113, the trade should still be open and enjoying a positive swap. On the other hand most traders might not have this patience so likely exited with some kind of time-stop.

 

1.71130 resistance intact

With resistance intact and consolidation below this line now into the 9th week from right shoulder, this whole setup remains as compelling. In addition, there is now a bearish expansion in the daily chart combined with trendline break. This is a signal for EURNZD bears.

EURNZD monthly (top) and daily chart

EURNZD monthly (top) and daily chart | Source: Tradingview.com

I just hope the triangle does not turn into a horizontal channel.

Director, TerraSeeds Market Technician Pte Ltd. Trader, investor. @sohtionghum was picked ‘Top 70 Forex Twitter in 2015’. Operates multiple strategies.

“Dear reader, I do not have a financial license to give advice. I do not know you the reader. Your financial objective and risk tolerance may be different from mine. I am not responsible for any consequence of your action.

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