NZD/USD 20 JUNE 2012

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Price rallied yesterday and gave us a new AB swing. We are at the 382 of the new AB swing.

FOR TODAY:

We need price to retrace to the 618/786 followed by a bullish cs formation for a long trade setup.

Shorts are considered on a clear bearish cs formation after a test of the BF786.

If we don’t get the setup we are looking for then we don’t trade.

SHORT: Will be going short only IF:

We will need price to rally to test the BF786 followed by a bearish cs formation for a short trade setup.

A sustained break of 7989 negates this view and opens the upside to further rallies.

If we don’t get the set-up we are looking for then we don’t trade.

LONG: Will be going long today only IF:

We need a retracement down to the 618/786 of this swing followed by bullish cs formations. Place stop 10 pips below the low of the cs formation, max 1 % risk. Limits defined at time of entry.

If we don’t get the setup we are looking for then we don’t trade.