Wednesday, 08 October 2008 05:51:16 GMT
Written by Thomas Long, Power Course Instructor
Full Article
A look at a 4-hour chart of the AUD/NZD confirms once again just how weak the AUD has become recently.
All of these pairs are trending strongly and offered great trading opportunities in the last week or two. But this is the time when professionals use extreme patience and discipline in waiting for the next selling opportunity. Notice how the Slow Stochastics, using values of 15,5,5, have not yet come close to the overbought level, which is considered 80 or above. I have circled three occasions on the chart where the indicator did move up to above 80, which signaled a selling opportunity since the direction of the trend was down. We want to wait for the market to reach a point where the odds of a successful trade are better and this is where the use of technical indicators can be of great value.
