The NZDCHF has formed a Bearish Engulfing Bar (BEEB) on the daily price action chart. This BEEB has a very long wick on it that is protruding up and through the resistance and making a false break. A false break is made when price pushes through a level and snaps back to “fake out” the market to make a false break. We can see on this chart that price moved higher and then was smashed back lower creating the false break and the BEEB. For the false break to be complete price has to then in the next session move lower and confirm the move by breaking the low of the engulfing bar.
If price can break the engulfing bar and make a move lower the next short term support comes in around 0.9520. If price moves higher we can see that the resistance that the BEEB is rejecting will be the first major resistance standing in the way. This is a major level and key resistance.
Also to note is that the Non Farm Payroll (NFP) is due out during this next daily session in the US. This can tend to send markets wild when the announcement is released and is something traders should keep in mind. Price will normally be quite subdued leading up to the announcement as traders are unsure which way the announcement will go and then price can then tend to explode either way afterwards. This can be a bit of a lottery when it come to the NFP because the move is so erratic.
NZDCHF Daily Chart
Leave a Reply