EUR/NZD Bearish Cypher
Updated
Happy Friday everyone,
Just before the market closes for the weekend I am eyeing up this potential short. Heading into next week I will be monitoring this pair on the 4 hour chart to look for an ideal reversal candle (hanging man, shooting star or bearish engulfing). This pair may become volatile on Tuesday 26/04 as a result of the European Central Bank's decision rate. French Finance Minister, Bruno Le Maire, this week described ECB interest rates as 'clouds'. This can be taken in many ways however, since price has broken the weekly trend line and began to consolidate on the daily timeframe at a level of resistance, I don't mind looking for a potential short position should the correct candles arise. The ideal reversal candle I am looking for may come after price has surpassed my stop loss- in which case I will not take a trade, but know that price is currently in an area where a reversal is possible.
The weekly trend line has broken after hitting resistance at 1.7481 (the highest price has been since 2016) back in December. Since then the daily time frame has made a lower high and re-tested the 1.71 area several times (see below). Since the last re-test of this level, price has also made a lower low. This may indicate loss of faith in the Euro before further decline or continuous consolidation.
Cypher ratios
B = 0.382-0.618
C = 1.272-1.414
X to D = 0.786
Risk as always is at 1:2 minimum (most commonly with the cypher pattern).
Just before the market closes for the weekend I am eyeing up this potential short. Heading into next week I will be monitoring this pair on the 4 hour chart to look for an ideal reversal candle (hanging man, shooting star or bearish engulfing). This pair may become volatile on Tuesday 26/04 as a result of the European Central Bank's decision rate. French Finance Minister, Bruno Le Maire, this week described ECB interest rates as 'clouds'. This can be taken in many ways however, since price has broken the weekly trend line and began to consolidate on the daily timeframe at a level of resistance, I don't mind looking for a potential short position should the correct candles arise. The ideal reversal candle I am looking for may come after price has surpassed my stop loss- in which case I will not take a trade, but know that price is currently in an area where a reversal is possible.
The weekly trend line has broken after hitting resistance at 1.7481 (the highest price has been since 2016) back in December. Since then the daily time frame has made a lower high and re-tested the 1.71 area several times (see below). Since the last re-test of this level, price has also made a lower low. This may indicate loss of faith in the Euro before further decline or continuous consolidation.
Cypher ratios
B = 0.382-0.618
C = 1.272-1.414
X to D = 0.786
Risk as always is at 1:2 minimum (most commonly with the cypher pattern).
Note
Here is a break down of the recent price action, scaled on the 4 hour chart for a more detailed view. You can see where price had made a lower low after re-testing resistance.Note
The dominant trend from 2017 has been broken and price is beginning to consolidate before the balance of supply and demand is once again tilted. 
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