NZDUSD Resumes Its Uptrend After A Sell-Side Liquidity Grab

NZDUSD Analysis: Price Resumes Its Uptrend After A Sell-Side Liquidity Grab

NZDUSD resumes its uptrend after a sell-side liquidity grab. Following the sell-side liquidity grab below the 0.62310 price level, the market continued its upward trajectory. While the market has been bullish for a relatively long period, the bulls are not satisfied yet.

NZDUSD Significant Zones

Demand Zones: 0.61560, 0.58140
Supply Zones: 0.70340, 0.65760

Before the bullish divergence in October 2022, the market’s order flow was bearish as the New Zealand dollar weakened against the U.S. dollar. The downtrend can be traced back to early last year from the major resistance level of 0.70340. Throughout June 2022 and the third quarter of last year, NZDUSD was within the 0.65760 and 0.60610 trading range. On June 14, 2022, the price created a weak low, and after two weeks, the low got invalidated as the price grabbed sell-side liquidity.

Between the weak low and the sell-side liquidity grab, a short-term high was created at the 0.63950 price level. The short-term high was algorithmically invalidated on August 14, 2022, as price sought sell orders inside the premium array at the 79.0% Fibonacci retracement level. The selling pressure available at the 79.0% Fibonacci retracement level was the cause of the long downtrend. According to the Stochastic indicator, the downtrend continued even in an oversold region until October 2022. Currently, NZDUSD has already invalidated the previous high at 0.65140; the continuation of the trend is thus highly probable.

Market Expectation

NZDUSD is also bullish on the four-hour chart after the Sell-Side Liquidity (SSL) grab. Currently, NZDUSD is seeking buy-side liquidity at the 0.65140 price level. Once the market reaches buy-side liquidity above the price level, the double bottom might be invalidated before the uptrend can continue.

Note: Forexschoolonline.com is not a financial advisor. Do your research before investing your funds in any financial asset or presented product or event. We are not responsible for your investing results.