NZDUSD Analysis – Market Poises to Resume Uptrend After A Return From Premium Zone Mitigation Block
NZDUSD is poised to resume its uptrend after a return from the premium zone mitigation block. After reaching a yearly high at $0.65380 in late January 2023, bullish momentum stalled, and NZDUSD fell below $0.60840. During the massive crash from the premium zone, a mitigation block formed at $0.62000. NZDUSD is likely to resume its downtrend after returning to the mitigation block at the premium zone.
NZDUSD Significant Zones
Demand Zones: $0.57090, $0.54320
Supply Zones: $0.60840, $0.65380
NZDUSD initially had a bullish outlook but turned bearish after a key resistance at $0.65380 was hit. This led to two lower lows, reaching $0.60840. A correction phase followed in May 2023, with NZDUSD struggling at $0.63900, disrupting the market structure and leaving a liquidity pool above it. After bouncing from $0.59850 support, a bullish retracement occurred within the range of $0.65380 resistance and $0.59850 support.
Seemingly, the bears took over as the market invalidated the equal highs at $0.63800. This led to a significant crash due to prolonged overbought conditions until July ended. The RSI remained above 50.0 throughout this period until the massive crash occurred. A mitigation block formed as the bears sank NZDUSD to the downside. The market is making a significant retracement to the upside. NZDUSD is likely to keep heading upward until the mitigation block is reached.
Market Expectation
A change of character to the upside is yet to occur on the four-hour chart. However, NZDUSD is currently heading upward after the sell-side liquidity sweep below the $0.58860 low. Following the invalidation of the $0.60150 major high, the emerging bullish trend is expected to continue into the premium zone.
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