The 240-minute NZD/USD broke higher through resistance at 0.7138 – the price at which a breakout buy was triggered on the Triangle pattern’s downtrend line. Currently, the pattern has an Initial Trend reading of three bars, which is ideal for this non-trending consolidation pattern (a three-bar reading points to an accumulation cycle, which is a narrow ranging, non-trending market). The move higher has maintained support above the pattern’s top line, and this bodes well for continuation higher to the Forecast area between 0.7173 and 0.7215; another factor that could play into upside follow-through is the activity on the Gold market, because the NZD/USD is a commodity currency that often tracks with precious metals.
The Triangle pattern on Gold’s 240-minute chart rallied higher through 1,145 and triggered a breakout buy, with prices today moving sharply higher. The rally does lend more bullishness to the NZD/USD breakout, and could be the extra push needed to carry it towards 0.7173. Gold, however, will hit a resistance level as prices push to 1,162, which could cause the NZD/USD to stall within the Forecast area as traders wait to see if Gold establishes an intraday double top.
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