Market Overview
The Euro (EUR) against the New Zealand Dollar (NZD) has recently shown strong bullish momentum, breaking through a key resistance level. This analysis covers the price structure, key levels, potential trade setups, and risk management strategies.
Timeframe: Daily (1D) Chart
The analysis is based on the daily (1D) timeframe, indicating a medium- to long-term perspective.
Key Observations from the Chart:
- Ascending Channel: Price is currently moving within a well-defined bullish channel.
- Key Resistance Breakout: A strong bullish breakout above the previous resistance zone (1.8450-1.8500) indicates buyers are in control.
- Fair Value Gap (FVG) Retest: The market may retest the FVG key level around 1.8350-1.8400 before continuing higher.
- Exponential Moving Averages (EMA):
- 50 EMA (Blue): 1.8335
- 100 EMA (Red): 1.8232
- 200 EMA (Green): 1.8096
The price is trading well above all major EMAs, confirming a strong bullish trend.
Trade Setup:
Buy Entry (Long Position)
- Entry Zone: 1.8400-1.8450 (After a pullback to FVG)
- Stop Loss (SL): Below 1.8190 (Below 200 EMA for protection)
- Take Profit (TP): 1.8750-1.8850 (Upper boundary of the ascending channel)
- Risk-Reward Ratio: 1:3 (Low-risk, high-reward setup)
Trading Plan & Strategy
- Confirmation of Retest:
- Wait for the price to test the 1.8400-1.8450 support zone before entering a buy trade.
- Look for bullish candlestick patterns (e.g., pin bars, engulfing candles) as entry confirmation.
- Risk Management:
- Place Stop Loss (SL) at 1.8190 to protect against unexpected reversals.
- Consider trailing the stop loss as price moves in profit.
- Exit Strategy:
- Partial profit-taking at 1.8650, allowing the rest of the position to reach 1.8750-1.8850 if momentum continues.
Final Thoughts
EURNZD is displaying a strong bullish trend after breaking key resistance. The ideal approach is to wait for a healthy retracement before entering long positions. Traders should monitor market conditions and adjust risk accordingly.
