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Liftoff in GBPNZD confirms 80 day trough

Launching Long

In the previous post on my newest portfolio addition, the pound against the new zealand dollar, I expected an 80 day low to hit very soon. Well, price launched out of this trough very strongly I believe on the 4th of March. Sentient trader has not placed the trough yet but there is little doubt in my mind it is the 80 day cycle low. Check out the chart below:

GBPNZD_£__daily_10_03_2015Entry for this ‘A’ category trade was a cross of the 10 day FLD. Initial target was 20784 as the Hurst T2 for this long, calculated on a cross of the 20 day FLD in purple above. That target was achieved just today as I write this post. A very satisfactory trade and I am happy that even though longer cycles are somewhat ambigious the reliable 80 day cycle is clear in this pair. The 80 day was confirmed fully on a cross of the 40 day downward VTL, shown in blue above.

Looking ahead I expect price to break the high made on February the 3rd and we will see what happens after that. The most likely candidate for the most recent 18 month trough is back in September of 2014 although this is not ideal as the low was taken out by the recent 20 week cycle trough, shown above. If price takes out the high of September the 29th 2014 of 21057 I will have to assume that 18 month candidate is correct. If it does not it implies a sharp turnaround in this pair and a large descent into the 40 week cycle trough. The probabilities are favouring the former option.

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