Testing downtrend resistance within what resembles a falling wedge, traders should be alert for a potential bullish breakout in NZD/USD that may see the pair retest the December highs in the not-too-distant future.
Should the price climb and hold above the downtrend currently located around 0.5780, longs could be established on the break with a tight stop beneath for protection against reversal.
Convention suggests a breakout may lead to an eventual retest of resistance at 0.5843, where it stalled in December. However, keep a close eye on price action at 0.5800 given the pair’s tendency to gravitate towards big figures. Should a breakout falter around 0.5800, consider squaring the position.
While the oscillators reveal flagging upside strength, providing a neutral signal on directional risks, there are fleeting signs emerging that momentum is starting to swing back in favour of the bulls. A continuation of those trends would likely improve the probability of a bullish breakout sticking.
From a fundamental perspective, details within today’s U.S. CPI report provide an obvious catalyst to spark a violent move in the Kiwi, with a soft outcome the most likely to deliver upside for the pair. Therefore, price action post the release should be treated as far more reliable than that beforehand.
Good luck!
DS
Should the price climb and hold above the downtrend currently located around 0.5780, longs could be established on the break with a tight stop beneath for protection against reversal.
Convention suggests a breakout may lead to an eventual retest of resistance at 0.5843, where it stalled in December. However, keep a close eye on price action at 0.5800 given the pair’s tendency to gravitate towards big figures. Should a breakout falter around 0.5800, consider squaring the position.
While the oscillators reveal flagging upside strength, providing a neutral signal on directional risks, there are fleeting signs emerging that momentum is starting to swing back in favour of the bulls. A continuation of those trends would likely improve the probability of a bullish breakout sticking.
From a fundamental perspective, details within today’s U.S. CPI report provide an obvious catalyst to spark a violent move in the Kiwi, with a soft outcome the most likely to deliver upside for the pair. Therefore, price action post the release should be treated as far more reliable than that beforehand.
Good luck!
DS
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The information and publications are not meant to be, and do not constitute, financial, investment, trading, or other types of advice or recommendations supplied or endorsed by TradingView. Read more in the Terms of Use.
Disclaimer
The information and publications are not meant to be, and do not constitute, financial, investment, trading, or other types of advice or recommendations supplied or endorsed by TradingView. Read more in the Terms of Use.