The current granddaddy of the currency market besides USD/BRL is found in GBP/NZD because its ranges and ability to move runs far and wide. Current ranges for example runs from 1.7400’s to 1.8200’s. From a daily perspective, 100 pips and more on any trading day is quite an easy accomplishment for GBP/NZD. Currently, GBP/NZD correlates to GBP/USD at + 90% and like GBP/JPY runs with GBP/USD.
From current 1.7850’s, GBP/NZD is dead center middle range. Dead center middle range means 1.7853 to lower at 1.7814. Above 1.7853 then next comes 1.7983 while below 1.7814 comes 1.7712 and 1.7610. Above 1.7983 comes the top channel point at 1.8126. Overall, GBP/NZD like its brother GBP/JPY price is extremely low.
The current base is found at 1.7494 and many massive supports exist above at 1.7579, 1.7586, 1.7687. Then comes 1.7700’s from 1.7709, 1.7712, 1.7725 and 1.7742. The two top points are 1.7877 then 1.7944. The level 1.7944 is top and a break would travel to the most vital point break at 1.8077. If this sounds like GBP/JPY, its the price when currency pairs correlate so strongly. GBP/CHF, GBP/CAD and GBP/AUD will find the same situation only the numbers of the exchange rates change. All are middle range.
The game plan to complete a long trade is to long at lower 1.7700’s. Ultimately, I want to catch 1.7712 to 1.7725 and target back to the 1.7814 area. We have a few hours until Asia gets going so I’ll try to catch correctly.
Brian Twomey, Inside the Currency Market, btwomey.com