False Breakout on the NZDUSD!

Yesterday, we received data from the job market in New Zealand. Unemployment Rate rose higher than the analysts’ estimates. That is definitely a negative information for the NZD but the currency is suffering heavy losses since Monday.
Tomasz Wiśniewski
False Breakout on the NZDUSD!

In my opinion, the big contributor here is the technical situation with the Head and Shoulders pattern as a main player.

The reversal from the beginning of the week is a false breakout above the neckline of the big inverse head and shoulders pattern. NZDUSD loves this structure! The head of this is build from a smaller iH&S. What is more, the right shoulder had two H&S patterns inside. The last one is the false breakout mentioned above. As a technical analyst, I call this amazing. The sentiment here is negative.

Second one is the pair of two safe heavens, CHFJPY. Currently we are inside of a pennant, which is formed after the breakout of two major down trendlines. Bullish momentum seen recently is driven by the double bottom formation on the long-term chart. Currently, most traders wait. Price breaking the upper line of the pennant, will give us a signal to go long and price breaking the lower line, will give us a signal to go short.

Last one is Gold, where we are also inside of the sideways trend. The price did not manage to break the 1518 USD/oz resistance, which caused a proper drop. Now, we are testing the lower line of the rectangle. As long as we stay above, buyers can be optimistic but breakout to the downside will change the outlook to a negative one.

This article is written by Tomasz Wisniewski, Director of Research and Education at Axiory

Don't miss a thing!
Discover what's moving the markets. Sign up for a daily update delivered to your inbox

Latest Articles

See All

Expand Your Knowledge

See All
The content provided on the website includes general news and publications, our personal analysis and opinions, and contents provided by third parties, which are intended for educational and research purposes only. It does not constitute, and should not be read as, any recommendation or advice to take any action whatsoever, including to make any investment or buy any product. When making any financial decision, you should perform your own due diligence checks, apply your own discretion and consult your competent advisors. The content of the website is not personally directed to you, and we does not take into account your financial situation or needs.The information contained in this website is not necessarily provided in real-time nor is it necessarily accurate. Prices provided herein may be provided by market makers and not by exchanges.Any trading or other financial decision you make shall be at your full responsibility, and you must not rely on any information provided through the website. FX Empire does not provide any warranty regarding any of the information contained in the website, and shall bear no responsibility for any trading losses you might incur as a result of using any information contained in the website.The website may include advertisements and other promotional contents, and FX Empire may receive compensation from third parties in connection with the content. FX Empire does not endorse any third party or recommends using any third party's services, and does not assume responsibility for your use of any such third party's website or services.FX Empire and its employees, officers, subsidiaries and associates, are not liable nor shall they be held liable for any loss or damage resulting from your use of the website or reliance on the information provided on this website.
This website includes information about cryptocurrencies, contracts for difference (CFDs) and other financial instruments, and about brokers, exchanges and other entities trading in such instruments. Both cryptocurrencies and CFDs are complex instruments and come with a high risk of losing money. You should carefully consider whether you understand how these instruments work and whether you can afford to take the high risk of losing your money.FX Empire encourages you to perform your own research before making any investment decision, and to avoid investing in any financial instrument which you do not fully understand how it works and what are the risks involved.