today I would like to share with you my day trading analysis of NZD/CAD.
This pair caught my attention at the first sight because there was one of my favorite formations very nicely visible there.
The formation is a price channel/rotation followed by an aggressive and sharp trend. In this case, it is an uptrend.
Volume Profile Analysis
If you check the volume distribution in this rotation with Volume Profile, then you will see, that there were massive volumes traded there.
The heaviest volumes were at 0.9168. This is actually the Weekly Point OF Control (POC), which means that the heaviest volumes of this week (so far) have been traded there.
Since there is an uptrend commencing from the POC, we can surmise that in that heavy volume area, strong Buyers were building up their Long positions.
When the Buyers had entered their Longs there, they pushed the price aggressively upwards.
When the price makes it back into the heavy volume zone around 0.9168, those Buyers are likely to defend this zone. It is an important zone for them because they placed a lot of their Long orders there!
They will defend it with aggressive buying (using Market Orders) and this should drive the price upwards again.
And this is the reason I believe that this POC will work as a Support when the price hits it at some point in the future.
I call this setup the “Volume Accumulation Setup” and you can see it in the picture below.
NZD/CAD, 30 Minute chart below:
Another nice reaction was on a “Trend Setup” on EUR/AUD which I talked about in the Weekly Trading Ideas video I published here on Monday:
Here is the PREDICTION→RESULT:
Did you trade those Supports guys? Let me know in the comments below!
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