NZDUSD Turns Bullish After A Rapid Expansion To The Upside

NZDUSD Analysis: The Market Turns Bullish After A Rapid Expansion To The Upside

NZDUSD goes bullish after a rapid rise to the upside. NZD/USD is currently in a distribution phase, and a markdown is looming as NZDUSD buyers exit the market.

NZD/USD Significant Zones

Demand Zones: $0.61620, $0.55120
Supply Zones: $0.70340, $0.65140

Following a relatively long period of rapid price growth to the upside, the NZDUSD entered an overbought region as well as the supply zone to seek sell orders. As the price approached the supply zone at the $0.65140 price level, the last two highs were higher highs in price but lower highs on the Relative Strength Index. This shows that the market is about to experience a bearish divergence. A massive crash to the long side is very likely due to the long period of upside expansion as well as selling pressure at the supply zone and the overbought region.

Since the break and retest of the $0.70340 resistance, the market has been typically descending the crest until a clear expansion to the upside in September 2022. The clear expansion to the upside was characterized by numerous breaks of structure as the price kept heading upward. Currently, NZDUSD remains at a premium; the price is expected to dive deep into the trading range and experience either a retracement or a reversal. The current trading range is defined by the $0.65140 and the $0.55120 price levels. The market is currently seeking sell orders within the bearish order block (-OB) region; a rapid decline may occur afterward.

Market Expectation

On the four-hour chart, buy-side liquidity has been grabbed as the price keeps heading to the upside. NZDUSD is expected to sink deeply into discount any moment from now.

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