Market Analysis: NZDUSD Prepares for a Bearish Move
The NZDUSD currency in a recent observation revealed a notable bullish trend originating from a strong demand level at 0.58860. This uptrend has persisted until encountering significant resistance at the 0.62080 mark. The 0.62080 level has proven to be a formidable barrier, as evidenced by multiple unsuccessful attempts to breach it in late February and early March of 2024.
NZDUSD Significant Zones
Resistance Levels: 0.62080, 0.63450
Support Levels: 0.60450, 0.58860
As the market approaches the 0.62080 resistance once again, the current price action suggests a hesitation to advance beyond this threshold, signaling potential exhaustion in bullish momentum. This could indicate a looming decline as the market anticipates a downward correction. Corroborating this view, the daily Relative Strength Index (RSI) has shown a decline from the overbought territory of 70.0, further hinting at diminishing bullish strength.
The 4-hour chart indicates the presence of liquidity below the market, potentially acting as a magnet for the price. Additionally, the 4-hour RSI contradicts the daily readings by indicating an uptick in strength, which may signal a forthcoming bullish pullback. This pullback is anticipated to activate the 4-hour order block, setting the stage for the price to engage with the liquidity below and address the Fair Value Gap identified in the market structure. Forex signals are monitoring these developments closely for trading opportunities.
Market Expectation
The price is anticipated to retrace to the 4-hour order block. Additionally, as the price approaches the order block, the 4-hour Relative Strength Index should indicate an overbought condition, adding confluence to the bearish price action.
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