Market Analysis – NZDUSD to Break Upwards Using a Double Bottom Reversal Pattern
NZDUSD employs double bottom reversal pattern to help it beat the 0.71050 resistance and move the market upwards. The major trading zone for the market since the turn of the year is between 0.73100 and 0.71050 key levels. This ranging zone has helped to curtail the bullish momentum with which NZDUSD was coming.
The undulating pattern of the market’s volatility, however, ensures that the market does not fully succumb to the restrictions placed on it. The first attempt of the price to break out of the channel came on the 22nd of February 2021. Price broke through the upper border and reached the 0.74600 key level, after which it fell as swiftly as it rose, back into the channel. Later on, on the 23rd of March, the bears brought the price down the channel, but it just took 17 trading days for the price to rally back into the channel.
The latest attempt to break out of the channel came on the 16th of June. Till today, the market has not found it all that easy to rally back into the channel. This is due to strong resistance from the 0.71050 key level. The market has since conformed to a double bottom reversal pattern to break the barrier and move back into the channel. The ATR (Average True Range) shows the market volatility is still undulating but is currently facing upwards. The 9MA (Moving Average) has moved below the daily candles as support to push it up.
NZDUSD Significant Zones
Resistance: 0.74600, 0.73100, 0.71050
Support: 0.69400, 0.68000, 0.67200
Market Anticipation
On the 4-hour chart, the double bottom reversal pattern can be seen. The 4-hour candles have gotten to the support line. The price is expected to retest the support line before breaking upwards. The ATR shows that undulating volatility is currently facing downward. The 9MA has moved lower of the candles, acting as support. This shows the current bullish market activity.
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