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GBP/NZD Long Opportunity at 2.2384

The information, including Commentary and Trade Ideas, provided on FX360.com should not be relied upon as a substitute for extensive independent research which should be performed before making your investment decisions. Global Forex Trading and FX360 .com is merely providing this information for your general information. The information and opinions presented do not take into account any particular individual’s investment objectives, financial situation, or needs. All investors should obtain advice based on their unique situation before making any investment decision and should tailor the trade size and leverage of their trading to their personal risk appetite. Any projections or views of the market provided by FX360.com may not prove to be accurate.

Last updated 2/10/2010 6:33 PM EST (GMT -5) 4 Comments

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Bradley W. Gareiss

Technical Analyst, GFT

A bullish Gartley pattern is emerging on the GBP/NZD 2hr Chart.  The Gartley would also function as a double bottom.  This pair has seen excellent symmetry lately.  We can see on the left chart that both the AB and the CD legs have smaller ABCD patterns within them.  This also form a channel, and the trade would enter at the bottom of the channel.  There is no guarantee any trade will work, but this one has a lot going for it.

We are looking to buy the GBP/NZD if it falls to 2.2535 (Point D).  Point D is located at the convergence of the following points:

We will now go over what to watch for assuming the pair continues falling toward our entry at 2.2384.  If the pair comes within 30 pips of reaching our entry, does not enter, and reaches T1 before entering, the trade is invalid.  The trade is also invalid if the pair rises above 2.2590 before hitting our entry.

To recap, we will look to buy the GBP/NZD at 2.2384 with our stop placed at 2.2277.  Our initial profit target is 2.2545 (38.2% of CD).

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  • 2hr Chart - ABCD patterns with in both the AB and CD legs of the primary pattern.
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  • 2hr Chart - Bullish Gartley; buy at 2.2384.

The information, including Commentary and Trade Ideas, provided on FX360.com should not be relied upon as a substitute for extensive independent research which should be performed before making your investment decisions. Global Forex Trading and FX360 .com is merely providing this information for your general information. The information and opinions presented do not take into account any particular individual’s investment objectives, financial situation, or needs. All investors should obtain advice based on their unique situation before making any investment decision and should tailor the trade size and leverage of their trading to their personal risk appetite. Any projections or views of the market provided by FX360.com may not prove to be accurate.

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Comments (4)

NeoFX

February 10, 2010 at 07:49 PM ET

Brad,

the way I've learned is if the ret goes 38%, 50%, or 61.8% then our D should be the 161.8. and I know sometimes it bounces off the 127 regardless, however sometimes it doesn't. I'd for instance buy the 161.8% at 2.2300 which also congerges with the big UP ABC 50% on 8hr.

are ou basing this on the fact that prev major support exists at point X? am I missing something?

either way great job, this hit your entry right on the money just now and bounced up. Unbelievable ;-)
great job!!
R

bgareiss

February 11, 2010 at 02:26 PM ET

II also don't understand what you mean by your first sentence above. Which retracement are you describing? I based this entry on two ABCDs, a double bottom, and the 161.8% extension of BC. Brad

NeoFX

February 11, 2010 at 10:55 PM ET

i'm referring to your C point above on 2hr chart. the C hit the 61.8% and according to the way i've learned this I thought you were supposed to exit close to the 161.8% extension if it hit the 38 % the 50% or the 61.8%. Sure enough this went down just past the 2.2252 area, or the 161.8 D extension of the A B C on 2hr chart. in other words, this went down to about where you had your stop loss..no biggie, just asking :-)



thanks for the reply

bgareiss

February 11, 2010 at 11:19 PM ET

How are you determining that extension? The only 161.8% extension is when you use the Fibonacci tool from point B to point C. I also am unclear on which points you are referring to when mentioning the 38.2%, 50%, and 61.8%. There are many different points you could use to determine any of these ratios. Send me a chart at bgareiss@gftforex.com if that is easier. Brad

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