Technical outlook:
NZDUSD dropped through the 0.6196 low on Tuesday, just a few pips below the previous swing low, before finding mild support. Prices have bounced back to 0.6238 at this point of writing and are expected to continue further higher. The potential remains for an Engulfing Bullish candlestick pattern on the daily chart. A close above 0.6255 will confirm the same and a potential trend reversal going forward.
NZDUSD is now facing strong resistance around 0.6575 followed by 0.7034, while the interim support is just below the level of 0.6200. Prices need to break above the 0.8575 level to confirm a potential trend reversal and that bulls are back in control. A potential upside target points to at least 0.6700 in the near term.
NZDUSD has dropped through fresh swing lows accompanied by a strong bullish divergence on the daily RSI as seen on the chart here. This could be seen as a potential trend reversal with bulls preparing to regain control. Watch out for a break above the 0.6290 mark for initial confirmation of a potential bottom in place.
Trading plan:
Potential rally through 0.6575 against 0.6100
Good luck!
