Looks like acknowledging the importance of the different forex sessions and their relative signals was crucial in approaching this trade. I wanted the US session to confirm the sell signal from the London session before entering the trade. That did not happen and so I did not get short. As a result, the pair shot up to a new high, completely invalidating the trade....for now. The pair is over ought and is wrapping up a five wave rally so I'm still looking for an opportunity to get short.
ORIGINAL POST:
On the 1hr AUDNZD chart you can see that the pair is wrapping up a large 5 wave rally, and is currently in a wave ((iv)) that should bring the pair down to the 1.1048 level. This looks to be a (c) wave so it should be quite sharp, and so the fact that my proprietary indicators triggered a short signal early this morning tells me we'll get a nice move lower soon.
Overnight signals are reliable, although they are not the most reliable. So I want to see some follow-through to the downside in the US session. So I'm going to short on a new low and further weakness only. If a new low occurs in the US session, I'm looking for a sharp move lower to the 38% Fibonacci retracement level around 1.1050-1.1100. Here's my trade:
Sell stop at 1.1200
Stop 1.1295
Profit Target 1.1100
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PLEASE NOTE: THIS IS JUST AN ELLIOTT WAVE ANALYSIS BLOG AND IN NO WAY GUARANTEES OR IMPLIES ANY PROFIT OR GAIN. THE DATA HERE IS MERELY AN EXPRESSED OPINION. TRADE AT YOUR OWN RISK.
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