Technical Analysis

NZDUSD technical analysis: Testing critical channel resistance level | 20th June, 2017

NZDUSD channel analysis

Bearish trade setup in the NZDUSD pair near the channel resistance

First Critical Resistance: 0.7300

Second Critical Resistance: 0.7402

First Critical Support: 0.7095

Second Critical Support: 0.6830

Overall Sentiment: Bearish ∇

There NZDUSD pair has rallied higher for the last consecutive 5 week and currently, the bullish momentum of this pair has ceased after the pair hit the channel resistance level at 0.7300.This level is going to provide a significant amount of selling pressure the Kiwi dollar as we have daily bearish pin bar rejection right at the channel resistance. The first bearish target for this pair is the minor support level at 0.7095 and a daily closing of the price below that level will ultimately result in a deeper decline. On the contrary, a clear break of the channel top resistance level will lead this pair towards the next critical resistance level at 0.7402

NZDUSD channel analysis

NZDUSD daily technical analysis

In the above figure, you can clearly see that price has rejected the current channel resistance level for two consecutive times and most of the professional traders have already shorted the kiwi dollar with a tight stop loss just above the tail of the pin bar. On the other hand, FED has already hiked their interest rate on the basis of 25 points and this has refueled the dollar bulls in the market. Since we have very little fundamental news release this week, we might experience ranging movement which is most likely to break in the downward direction.

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