AUD/NZD trading strategy
I got an email overnight from a trader who has sold AUD/NZD at 1.2610 and is looking for some strategy advice. The daily chart shows that this pair is in a solid downtrend so being short is an obvious play but this is one pair that tends to move sharply and then range trade so I’m not 100% convinced on this trade. The weekly chart is in a 1.23/1.33 long term consolidation and to sell towards the bottom of this range is certainly tempting fate in my view. Bears can put tightish stops above 1.2675 but realistically the down trend is in play until 1.2750 breaks so stops need to be kept above that level.
In other words, stay short by all means but keep positions relatively small, exit above 1.2675 and re-enter shorts if 1.2740 resistance holds.