GBPNZD Approaches Monthly Lows
Market Condition: Pending Breakout
Target 1: 2x ATR 1.1902
Target 2: 4x ATR 1.1314
Invalidation: 1X ATR over support at 1.2784
GBPNZD 1Day Chart
(Created using Marketscope 2.0 Charts)
The GBPNZD has declined as much as 1355 pips for the month of October. As prices move towards a new monthly low, traders can begin planning for the pair’s next breakout. The current monthly low stands at a price of 1.2419. This point on the chart represents active support, and traders can use this value to begin planning their breakout entries. Current ATR for the GBPNZD measures 294 pips. This indicator can help measure volatility, while helping to identify potential profit targets for a breakout. A 2x ATR target would place initial targets at a price of 1.1902. While traders looking for a 4x ATR extensions can begin targeting a price of 1.1314.
In the event of a false breakout, traders may look to manage risk by placing a stop using 1x ATR at a price of 1.2784. At this point the current breakout scenario above would be considered invalidated. It should also be mentioned that if prices fail to breakout towards a lower low, it may signal a shift in the markets current trend. In this scenario, any entry orders to sell the GBPNZD may be reconsidered for other opportunities.
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