NZDCAD Analysis - March 27, 2022
So I did a little charting and (top-down) analysis on NZDCAD. It's not a currency pair I am trading personally, but I used it for practice purposes only...
NZDCAD Analysis - March 27, 2022
Starting from the Weekly timeframe price has just retested a Supply area (0.88880 to 0.87690). I also can see an EQL looking at the current swing low that equals the low of March 11 of 2021 at 0.83425.
Scaling down then to the Daily timeframe price never closed above the 0.87690 level (low of the weekly Supply area), only wicked trough attempting to make a higher-high but never did.
On the 4h timeframe, I spotted another Supply area (Green) within the Weekly Supply area (Gray).
Although the 4h timeframe shows Bullish bias looking at recent price action by breaking structure to the upside, one can clearly see that price reacted pretty accurately from those "intertwined" Supply areas and has started to make a lower-high since. Also, when looking closer, I spotted a Demand area (Purple) that was the last indecision candle before the impulsive move right into the Supply area (Green). Thus leaving a huge imbalanced price gap behind to fill.
Now that I have a pretty good idea that the market bias is (turning) Bearish, aiming to close the imbalanced price area, I will go to a lower time frame and set out some key levels for possible shorts.
From the 1h timeframe perspective, we are ranging. I marked out some key levels on the chart based on this timeframe and then refined those levels on lower timeframes, keeping in mind the levels, structure from the higher timeframes.
When combining all the timeframe levels it looks like this.
In my humble opinion price will go for the liquidity below since there is also an in-efficient price action below it, with above that area an imbalanced price. Looking at the price action from the range high, it looks pretty efficient making those lower highs and lower lows, respecting each lower high on the way down. That's why my focus is more on the imbalance to the down instead of the one on the upside.
I think the price will go for the refined zone below eventually because:
- Major trend is a downtrend on higher timeframes
- Price made a huge impulsive move to the upside and tested a weekly Supply area leaving an imbalance price area behind
- Price has retested and rejected multiple times the weekly Supply area where the big impulsive move from earlier ended and never closed above it
- The substructure of the higher timeframe "swing" is making lower highs and lower lows on the lower timeframe
- There are multiple imbalanced price areas to the downside
NZDCAD Analysis - March 27, 2022
Starting from the Weekly timeframe price has just retested a Supply area (0.88880 to 0.87690). I also can see an EQL looking at the current swing low that equals the low of March 11 of 2021 at 0.83425.
Scaling down then to the Daily timeframe price never closed above the 0.87690 level (low of the weekly Supply area), only wicked trough attempting to make a higher-high but never did.
On the 4h timeframe, I spotted another Supply area (Green) within the Weekly Supply area (Gray).
Although the 4h timeframe shows Bullish bias looking at recent price action by breaking structure to the upside, one can clearly see that price reacted pretty accurately from those "intertwined" Supply areas and has started to make a lower-high since. Also, when looking closer, I spotted a Demand area (Purple) that was the last indecision candle before the impulsive move right into the Supply area (Green). Thus leaving a huge imbalanced price gap behind to fill.
Now that I have a pretty good idea that the market bias is (turning) Bearish, aiming to close the imbalanced price area, I will go to a lower time frame and set out some key levels for possible shorts.
From the 1h timeframe perspective, we are ranging. I marked out some key levels on the chart based on this timeframe and then refined those levels on lower timeframes, keeping in mind the levels, structure from the higher timeframes.
When combining all the timeframe levels it looks like this.
In my humble opinion price will go for the liquidity below since there is also an in-efficient price action below it, with above that area an imbalanced price. Looking at the price action from the range high, it looks pretty efficient making those lower highs and lower lows, respecting each lower high on the way down. That's why my focus is more on the imbalance to the down instead of the one on the upside.
I think the price will go for the refined zone below eventually because:
- Major trend is a downtrend on higher timeframes
- Price made a huge impulsive move to the upside and tested a weekly Supply area leaving an imbalance price area behind
- Price has retested and rejected multiple times the weekly Supply area where the big impulsive move from earlier ended and never closed above it
- The substructure of the higher timeframe "swing" is making lower highs and lower lows on the lower timeframe
- There are multiple imbalanced price areas to the downside
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