"You have a great entry in my opinion. However NZD is off my list at the moment, price too high to buy and momentum too much to go against. So really happy that you have a tight s/l.
Yes if it goes down I would recommend taking quick and small…"
"Thanks Oasis, I noticed the divergence in NZD/USD on the 4H chart. NZD/USD was also over bought on multiple time frames. The GDP data was slightly below expectations. So I took a short position on NZD/USD at 1.8733 ... As of now price is…"
"Priyank, there are many considerations here, to name a few:
1) Not every divergence will play out as it should.
2) Divergence on higher time frame charts will take longer to develop and play out.
3) Correct identification of the divergence itself -…"
"Hi Priyank, The old theory was the next 4 hour candle decides the divergence fate but in this new post 2008 era, you may want to drop down to a 15 minute time frame to determine or at least have a good approximation when divergence will be…"
"Hi Priyank, The break of 1.3638 clears the path to 1.3021 longer term but with hurdles. Near term 1.3665 and 1.3715 must hold to see eventually breaks of vital 1.3496 and 1.3363. Price so close to both levels however leaves both points heavily…"
"Ok Thanks Daologic. So which timeframe should I consider more accurate. I drew a line joining the highs of July 2008 and May 2011. On the Daily timeframe it shows it passes through 1.4050 - 1.4070 while on the Monthly charts it shows it passing…"