You know what's funny, back in 2013 everybody was saying the markets are untradeable, volatility is too low, nobody can make money until currencies start moving again. Now they are moving again, people are complaining about the volatility and pining for the good old days of 2013.
If you are looking at a currency cross like GBP/NZD and trying to apply technical analysis to it, you need to stop trading and go back to basics - start by learning what a currency cross is, and how it's price is calculated - Hanover gave you a big clue in post #9. GBP/NZD is derived from the current price of the Pound and the current price of the Kiwi.
TA is based on the belief that the price of an instrument will somehow respond to, or repeat, its own history. But GBP/NZD isn't even a tangible instrument ... GBP is a financial instrument, which is driven up and down by a range of factors ... what NZD has done in the past isn't really one of those factors. NZD is a financial instrument which is driven up and down by a range of factors - GBP's history isn't really one of those factors.
So to expect GBP/NZD to react to it's own past price action is a trap ... if GBP is moving down, it won't stop and reverse because it hit some level vs the Kiwi, because it is always hitting some level against some other currency. If NZD is moving up, it won't stop and reverse just because it hit some level vs. the Pound, because it is always hitting levels against all the other currencies too.
This post probably doesn't make sense to most traders. It will, if you stop trying to analyze "pairs" of currencies and start analyzing currencies individually - if you decide GBP is bearish, sell it. If you decide NZD is bullish, buy it.
If you are looking at a currency cross like GBP/NZD and trying to apply technical analysis to it, you need to stop trading and go back to basics - start by learning what a currency cross is, and how it's price is calculated - Hanover gave you a big clue in post #9. GBP/NZD is derived from the current price of the Pound and the current price of the Kiwi.
TA is based on the belief that the price of an instrument will somehow respond to, or repeat, its own history. But GBP/NZD isn't even a tangible instrument ... GBP is a financial instrument, which is driven up and down by a range of factors ... what NZD has done in the past isn't really one of those factors. NZD is a financial instrument which is driven up and down by a range of factors - GBP's history isn't really one of those factors.
So to expect GBP/NZD to react to it's own past price action is a trap ... if GBP is moving down, it won't stop and reverse because it hit some level vs the Kiwi, because it is always hitting some level against some other currency. If NZD is moving up, it won't stop and reverse just because it hit some level vs. the Pound, because it is always hitting levels against all the other currencies too.
This post probably doesn't make sense to most traders. It will, if you stop trying to analyze "pairs" of currencies and start analyzing currencies individually - if you decide GBP is bearish, sell it. If you decide NZD is bullish, buy it.
si hoc legere scis nimium eruditionis habes