Hah! I bet you were thinking about a plain old channel, were you? Not this time! What you see there is an ascending channel forming within an ascending channel, which means that the weak uptrend on NZD/USD’s 1-hour time frame is beginning to pick up the pace. The old ascending channel has been well-respected since mid-January, however, so the bulls who are trying to maintain the new channel have a lot of work in their hands since maintaining the new channel means invalidating the old one. And it looks like the bulls are preparing for an attack since the mid-channel area of the old channel is acting as support while the 200 SMA is acting as dynamic support. Also, stochastic is now indicating oversold conditions. If the bullish attack fails to materialize, then the pair may end up respecting the old channel.
GBP/NZD tried to break past support at the 2.0600 major psychological level on two separate occasions. However, the pair failed both times and is now moving back up, forming what could be a potential double bottom pattern. The neckline is at the 2.1000 major psychological level, which means that an upside breakout from the forex chart pattern may have enough momentum for a 400-pip move. In addition, if the neckline is broken then that means that the falling trend line (dashed line) that you see there would also be broken, confirming a trend break that may give the upside breakout an extra boost. However, stochastic is already signalling overbought conditions and it looks like the 100 SMA is acting as dynamic support, so there’s a chance that the pair will ignore the potential double bottom in favor of a third attempt to break past support at 2.0600.
EUR/NZD moved up rather quickly before hitting resistance at the 1.6800 major psychological level. There was no violent rejection, however, and so price began trading sideways, forming what looks like a bullish flag in the process. However, you may have also noticed that the bullish flag formed within an ascending triangle, but that’s okay since both are bullish forex chart patterns. It’s still a bit worrying, though, since there’s a chance that price will respect the triangle, forcing the pair to go back down and invalidating the flag. In any case, a breakout move to the upside will may move for around 500 pips, based on the flag and its pole, or 660 pips, if based on the triangle. In any case, just make sure to practice proper risk management should you find a trade based on this or any of the other charts, okay?
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To get the complete picture and avoid getting blindsided by economic data, you also have to do your fundamental analysis. Lucky for us, Pip Diddy fills us in on what we need to know about fundamentals with his Daily Forex Fundamentals.