7/23 Analysis: Exactly What We Look For…
At the London open, we have strong currencies (above the dotted zero line) and weak currencies (below the dotted zero line) but they are all turning the opposite way currently which indicates the trend is not continuing (at least for the moment). In other words, conditions are not favorable for trading right now.
If we fast forward just 30 seconds into the London session, the NZD (purple line) which has been strong for a while but pulled back down temporarily is now showing a steep line going back up indicating current momentum in the market.
The USD (blue line) has been weak before pulling back up temporarily but is now showing a steep line down indicating current momentum again to the downside.
This is exactly the kind of steep divergence we want to see with 2 currencies.
- NZD/USD BUY
You can see the huge move at the London open. These are 5 minute price bars. You could have entered this trade very quickly but even if you got in half way through the opening bar, price moved in your favor over 40 pips from that point.
You can watch the entire video analysis below:
You can see that our Currency Strength Indicator is an effective tool for picking out the highest probability, lowest risk trade set ups while avoiding market conditions that aren’t favorable. If you keep using this tool every day along with our daily Forex analysis, you will increase your win rate and be on your way to becoming a profitable trader long term.
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