The NZDUSD market has been grinding heavily above the mean value the last few weeks, only making slight ground to the upside. The markets have been pretty uneventful as the overall vibe is indecisive with the government shutdown, fed tapering and Syria issues floating around.
Like we mentioned, the NZDUSD has been gaining some ground and our bias is to the upside. The market holding above the mean value which is a bullish plus. The market recently sold off aggressively into the mean, which was heavily rejected by the bulls. This move closes as a large bullish rejection candle, but the market just went back to grinding after the event.
Last session, a similar thing happened but on a smaller scale, a bearish move into the mean value was rejected and at the candle closed as a bullish rejection candle. Boths of these signals have had their retracement entries triggered, but have seen no bullish follow through. The constant rejection of lower prices is a potential tip off that the market is gearing up ready to push into higher prices.
The market eventually starts moving again and hits minimum target goal
Last week we were looking into some bullish price action signals that developed off the mean value on the NZDUSD daily chart. The first signal was quite large and demonstrated clear rejection of lower prices. The market did stall and didn’t progress much in the next few trading sessions.
After the market stagnated for a while, a second dive into lower prices was rejected at the mean value, giving us the chance to enter in at the retracement entry price of the first larger bullish rejection signal.
The mean value had that nice ‘railway track’ pattern to it where it was just gliding up into the chart, which is a great sign of trend stability. The strong supportive properties of the mean were communicating that the trend was still intact.
Now the market has pushed up higher off the back of these rejection signals and reached the minimum profit target of 3x risk/reward. It’s here we should consider taking profits, we find many traders continue to make the same mistakes and don’t take profits expecting the market to just forever continue in their favor.
Although this trade did take a while to develop it was easy money, price action trading is definitely the way to approach the markets, that’s why we are so passionate about it here and DnB. If you would like to expand your knowledge and learn more about price action, we’ve set up a members only area called the ‘war room’ where price action traders gather, learn the price action protocol system and share trades and just talk about the markets in general. For more information about the war room stop by our war room info page.