NZD/USD Offers Trading Ideas for USD Reversal Bulls

The NZD/USD is breaking the daily chart support trend line. The US Dollar is picking up steam and this is clearly visible on the NZD/USD. How deep can the retracement go?

Price Charts and Technical Analysis

The NZD/USD seems to have completed a 5 wave (orange) pattern. This could indicate the end of a wave A (purple / or wave 1) and the start of a bearish pullback. If price action is indeed building a wave B (purple / or wave 2), then a decline towards the Fibonacci retracement levels is likely.

The bearish channel offers a clear outline of the downtrend. A bounce at the 23.6% Fibonacci could occur but price is likely to continue within the bearish channel. Only a break above 0.56 and the 21 ema zone would make such a bearish scenario unlikely (red x).

Good trading,

Chris Svorcik

The analysis has been done with the indicators and template from the SWAT method (simple wave analysis and trading). For more daily technical and wave analysis and updates, sign-up to our newsletter

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