DanV
Short

NZDUSD - FACES FURTHER WEAKNESS AHEAD - UPDATE

FX_IDC:NZDUSD   NEW ZEALAND DOLLAR / US DOLLAR
In the last published NZDUSD             chart (a month ago) our short at 0.77 was partially successful. However since then the price went on to continue complex retracement to the upside. For the background details I would suggest you review that chart if necessary to understand the details below (see link to that chart).

(Many are very bullish on NZDUSD             pair which might suggest that possible larger crown are wrong).

I then reviewed this and forgot to publish it as I was focused on catching NZD weakness buy going long on GBPNZD             which I did publish. So apologies for those who might have missed the initial entry.

However, it appears that it has already topped with a rising wedge (ending diagonal). The initial drop of the high appears to be impulsive and hence possible wave 1 decline if correct we could see strong wave 3 drop to follow.

Technicals:
1. Still in larger degree bearish cycle
2. Formed wxy zigzag retracement to the upside with waves "w" and "y" being of equal length.
3.Topped with (ending diagonal) rising wedge accompanied with RSI divergence.
4. Appears to have declined of the high in impulsive wave 1 and retraced partially for form bear flag visible on smaller time frame.
5. Any further weakness would break RSI rising support line and possible below corresponding rising trendline on price chart.
6. Downside targets are eyed with previous structure lows along the way and round numbers as follows:
Target 1 = 0.74
Target 2 = 0.72
Target 3 = 0.70

In Green you will note that if we have AB=CD measured move then we could be looking for 0.70 are but will have to see how it develops and 0.72 could well hold

See weakly chart for larger picture

Conclusion:

Any Bulls should not give too much room to their long positions as this is a high risk trade.

Traders should see what confirmation they require to consider possible short trade.

Observe the price as it moves to 0.72 in order to get clues about future expectation namely if the previous low would hold and form triple bottom or head to lower zone around 0.69.

As, always please do your own analysis for your requirement. Select to follow me and the charts for notification of any updates. If you like the analysis show this by thumbs up and constructive comments or alternative ideas for all to learn from.

Thank you for taking the time to view my analysis.

DanV
danv-charting.com
DanV MOD
2 years ago
Weekly chart referred to
snapshot
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DanV MOD
2 years ago
H4 chart showing wave 2 retracement on completion of which a short could be considered.
snapshot
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