NZDUSD- 4HR

NZDUSD –

Despite looking somewhat choppy and uninspiring on the longer-term charts, price action could be starting to heat up for the Kiwi Dollar as we venture into the lower time-frames in today’s Chart of The Day.

In particular, it’s the four-hour chart that we’re looking at above that currently shows a convincing bullish channel that emerged at the beginning of last month.

At present, the pair resides around the 0.6770 level in the upper regions of the channel, and we’ve seen plenty of impulsive moves higher to reach this area during recent sessions. If buyers manage to break above here, then 0.68 may slow things down a notch as resistance. It did this previously, forming a double-top reversal pattern.

On the other hand, if we resume this bullish channel’s path, NZDUSD might be in for a correction reasonably soon. Using the upper part of the channel as resistance, I suspect we could see bears target 0.67 and 0.6615, respectively. Furthermore, the RSI indicator is heading into heavily overbought territory, suggesting a price reversal may also be imminent.

Another directional clue linking to this pair is on the four-hour DXY (US Dollar Index) chart. The chart below shows the Dollar reaching a potentially strong support area at 92.47 with the scope for a rebound in price. It’s RSI indicator in stark contrast to NZDUSD shows the US Dollar sitting in heavily oversold territory.

Therefore, should this scenario occur on the DXY, a stronger Dollar may coincide with our bullish channel on our NZDUSD chart and begin to target the downside targets aforementioned.

 

Note: Click on charts to enlarge.

 

By Adam Taylor CTEe

.@adamt_trading

Sources: Go Markets, Meta Trader 5, TradingView, Bloomberg

Disclaimer: The articles are from GO Markets analysts,  based on their independent analysis or personal experiences. Views or opinions or trading styles expressed are of their own;  should not be taken as either representative of or shared by GO Markets.  Advice (if any),  are of a ‘general’ nature and not based on your personal objectives, financial situation or needs.  You should therefore consider how appropriate the advice (if any) is to your objectives, financial situation and needs, before acting on the advice.  If the advice relates to acquiring a particular financial product, you should obtain and consider the Product Disclosure Statement (PDS) and Financial Services Guide (FSG) for that product before making any decisions.

Next: Overnight on Wall Street: Tuesday 10 November 2020
Previous: Overnight on Wall Street: Thursday 05 November 2020