NZDUSD (Daily): An Interesting TREND CORRECTION!
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TECHNICAL ANALYSIS:
Since the beginning of April 2020, the price started a long and strong uptrend, creating a new ascending channel since July.
This channel acted really good as support and resistance, in fact the price has been rejected many times.
At the beginning of November, the price started getting strong momentum, and with a clear increasing of the volumes, the market moved up, breaking without any hesitation an important weekly resistance zone at about 0.68200.
At the beginning of December, the price reached again the main trendline resistance, a level that rejected the price many times (you can properly see that on the chart), breaking it and acting now as a new dynamic support level.
CONCLUSION:
The price is definitely trying to reach the next weekly resistance zone at about 0.74000, it actually got a rejection from a new trendline resistance and I believe in the possibility of a small trend correction, the price action will confirm it during the next days.
The price is actually overbought, it closed the last day with a down pin bar, the RSI is clearly showing a nice divergence in a daily perspective and it's moving in a period with high volatility.
What should you do? I normally don't open any position in this kind of situation, I'd prefer the price reaching the main resistance or support first and see how the price acts around that level but, having a look in the H4 time frame, there's a chance to get a nice correction up to 100 pips! I'll show you more details in my next NZDUSD H4 perspective.
TECHNICAL ANALYSIS:
Since the beginning of April 2020, the price started a long and strong uptrend, creating a new ascending channel since July.
This channel acted really good as support and resistance, in fact the price has been rejected many times.
At the beginning of November, the price started getting strong momentum, and with a clear increasing of the volumes, the market moved up, breaking without any hesitation an important weekly resistance zone at about 0.68200.
At the beginning of December, the price reached again the main trendline resistance, a level that rejected the price many times (you can properly see that on the chart), breaking it and acting now as a new dynamic support level.
CONCLUSION:
The price is definitely trying to reach the next weekly resistance zone at about 0.74000, it actually got a rejection from a new trendline resistance and I believe in the possibility of a small trend correction, the price action will confirm it during the next days.
The price is actually overbought, it closed the last day with a down pin bar, the RSI is clearly showing a nice divergence in a daily perspective and it's moving in a period with high volatility.
What should you do? I normally don't open any position in this kind of situation, I'd prefer the price reaching the main resistance or support first and see how the price acts around that level but, having a look in the H4 time frame, there's a chance to get a nice correction up to 100 pips! I'll show you more details in my next NZDUSD H4 perspective.
