This pair has been on a radar for pretty much the whole of this month. From the daily chart we can see that prices were stuck within a 300 pip range defined by the 38.2% and 61.8% Fibonacci retracement levels anchoring on Q4 high lows.
From that anchor, we can also see that prices are generally bullish and that is why we should be taking longs only. That condition alone necessitates proper timing for proper entries and at the moment it looks like that bounce from support at 1.675 can be a good reason to buy. Better still, early today, there was attempts for a close above the 50% retracement line which is our buy trigger line in the daily chart. Besides, stochastics are already positive and prices are also bouncing off from key support trend line.
In the 4HR chart, prices are inching higher in the direction of the bullish break out which we saw mid last week. As expected, break outs tend to retrace and it did but it didn’t retest the break out line. However, with that retest of the 50% retracement, buyers can look for entries with a 1:3 risk reward ratio.
This is my EURNZD trade plan:
Stop Loss: 1.68
Take Profit: 1.72