Market Analysis-NZDUSD Breakout Violates Support Zone
NZDUSD has broken out successfully, out of a consolidation that existed between 0.73000 and 0.71500. The support zone was retested on the 14th of June 2021. The pullback was a trigger to drive the price aggressively into the lower regions below 0.70700. The market has since then been trapped between the support zone at 0.69400 and the resistance zone at 0.70700 until today.
Before today, the market had found difficulty in breaking out. This is seen with the daily candles’ wicks above the zones and the bodies of the candles beneath the zones. A double top pattern was formed having experienced a little consolidation in the zone. This was a tussle between the bears and the bulls before the sellers successfully drove the market lower.
NZDUSD Key Levels
Resistance Levels: 0.73000, 0.70700, 0.74500
Support Levels: 0.71500, 0.69400, 0.68900
What to Expect From the NZDUSD Breakout Failure
The four-hour chart has shown a sink in price to the support zone. This 0.69400 is currently defending price breakout. The consolidation boundaries have been violated. A retest, which is currently being formed at the time of writing, is expected to strengthen the fall in the market to drive towards the next support zone at 0.68900.
The supposed retest seen forming on the four-hour chart might just continue to rally to create a false breakout. The relative strength index still gives room for the price to drop as it is yet to cross into the oversold region on the four-hour chart.
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