The key to getting better at charting is to look at tons of charts and draw lines connecting highs and lows until you find patterns. While doing this, I found a Right-Angled and Descending pattern in the 1 hour chart for NZDUSD. You can see the highs form a horizontal resistance line at the top, and the support line angles down connecting the lower lows. The way to trade this is with the trend, which we can see is a downtrend. Basically we are looking to short this as the price curls down off the top resistance and buy it back near support. Also, as the price heads down to support, we would set a sell order below support to catch a breakout down (we look for a breakout in the direction of the current trend). If the price has a partial rise off support, it is a sign of a breakout down, where we would short immediately.
Sunday, March 5, 2017
Chart 6: Right-Angled and Descending pattern in NZDUSD chart
The key to getting better at charting is to look at tons of charts and draw lines connecting highs and lows until you find patterns. While doing this, I found a Right-Angled and Descending pattern in the 1 hour chart for NZDUSD. You can see the highs form a horizontal resistance line at the top, and the support line angles down connecting the lower lows. The way to trade this is with the trend, which we can see is a downtrend. Basically we are looking to short this as the price curls down off the top resistance and buy it back near support. Also, as the price heads down to support, we would set a sell order below support to catch a breakout down (we look for a breakout in the direction of the current trend). If the price has a partial rise off support, it is a sign of a breakout down, where we would short immediately.
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