Overview:
Recently, EUR/NZD has been moving sideways around the level of 1.6065. We can observe low liquidity and weak price action. In the daily time frame, I found a weak supply bar and a strong head-and-shoulders confirmed formation (a broken neckline). According to the H1 time frame, the price is trading below 50, 100, 200 SMA. I found 2 climatic actions in a background and a strong up-thrust bar in an ultra high volume (sign of weakness). Be careful when buying EUR/NZD at this stage since lower prices are expected. I have placed Fibonacci expansion to find potential support levels. I got Fibonacci expansion 61.8% at the level of 1.6070 (broken), Fibonacci expansion 100% is at the level of 1.5840, and Fibonacci expansion 161.8% is seen at the level of 1.5470.
Fibonacci Pivot Points:
Resistance levels:
R1: 1.6075
R2: 1.6100
R3: 1.6140
Support levels:
S1: 1.6000
S2: 1.5975
S3: 1.5940
Trading recommendations : Buying EUR/NZD looks very risky at this stage since the price confirmed the head-and-shoulders formation. Watch for potential selling opportunities.
