NZD bulls rise in trending up channel, but now channel support

FX:NZDUSD   New Zealand Dollar / U.S. Dollar
173 0 6
In last couple of weeks, we've been observing bulls taking their role in rising channel pattern.

But, the current prices have now slid below DMAs, a decisive break below channel support creates more bearish pressures, else equal bullish potential is also foreseen.

We saw a “bearish engulfing” pattern occurred 3 days ago with big real body in rising channel pattern, as a result of the formation of this bearish pattern , current prices have slid below DMAs.

Ever since the pair has bounced back from the lows of 0.6347 levels, Kiwi dollar seemed like consolidating stronger from last couple of weeks but for now “Shooting Star” pattern occurred at 0.6851 levels (see weekly charts).

This bearish pattern on weekly occurring at stiff resistance of 0.6896 levels to signify some sort of weakness at this juncture.

After dropping from major this resistance at 0.6896 levels indicates previous consolidation trend seems again little weaker and more potential for downside to targets.

On weekly basis, Every time price was unable to hold onto resistance at 0.6896 levels it has dropped below to evidences dips upto 0.6425 levels, current price actions has dropped at the same levels.

RSI and  Stochastic oscillators on both daily and weekly graphs are suggestive of further declines as they evidence downward convergence to the price dips on daily divergence on weekly shows previous consolidation pattern seems exhausted at this level. 

While, %D crossover at 80s which is overbought zone on weekly plotting have been convincing that the selling momentum is still strong.

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Considering above technical reasoning, one can eye on option tunnel which is debit spread of binary version.

In-The-Money tunnel would be formed of shorts of in-the-money binary put with shorter expiries below the current exchange rate less an Out-Of-The-Money longs binary delta put below the exchange rate.

We wouldn't be surprised if the spot FX drifts upto 30-40 pips below current levels of 0.6846 levels in no time or 20-25 pips on northwards in intraday terms. The intention behind preferring such leveraged products is that the returns would be exponential for every pips movement goes in your favour.
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