Today’s trap in particular that we’re going to review is called the Trap Break Pullback, which occurred in the area 0.6645 to 0.6579 during the very first days of 2016. As those support traders were buying, believing that #NZDCHF will continue higher as it had done historically, they got a shock as price drops through the level strongly. Traders holding those positions will likely now be bailing out at break even, creating an opportunity for us to get onboard.
Should price give me a trigger around the 0.6580-level to 0.6560-level, this pair is interesting to the downside. Currently, the New Zealand Dollar is struggling because of commodity prices worldwide and the Swiss Franc is a safe haven play. Given the risk off environment we’re in, this trade makes sense.
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