NZD/USD has recently been steadily moving lower while trapped inside a descending channel. And presently, the pair is testing the channel’s resistance area. Moreover stochastic is already signaling overbought conditions while the 100 SMA appears to be acting as dynamic resistance. Those of you who are bearish on the pair therefore better start looking for shorting opportunities.
Similar price action has been playing out on NZD/CAD’s 1-hour chart. As a result, a descending channel has also clearly formed. And similar to the setup for NZD/USD, price is currently near the channel’s resistance area. Stochastic, meanwhile, has already reached overbought territory and the 100 SMA seems to be acting as dynamic resistance as well. Of course, there’s always a chance that the pair may blow to the upside instead of going lower, so make sure to practice proper risk management, okay?
If riding the trend is not your thing, or if you’re more of a breakout chartist, then check out that there chart for GBP/NZD. As y’all can see, a bullish pennant has emerged. A bullish pennant is, as the name suggests, a bullish chart pattern, so our main directional bias is to the upside. And should a topside breakout occur, then the pair may have enough steam for a whopping 1,000-pip run. But since a previous breakout attempt got faded quickly, there’s also a chance that the pair may break to the downside instead. You may therefore want to prepare for such a scenario.
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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.