NZDUSD just one small step from a major buy signal
17 March 2023
In today’s technical piece, I’d like to tell you about the NZDUSD, who is currently in a very interesting spot. Several more pips to the upside and we will get a proper, mid-term buy signal.
This optimism is stemming from the fact that the price created a huge inverse head and shoulders pattern (yellow). It is not active yet, as the price is still below the neckline (green). The neckline is the horizontal area around the 0.626 and the price breaking above that level will be a proper, mid-term signal to buy. Interestingly enough, the iH&S formation is bouncing off the 38,2% Fibonacci, which is a nice confirmation of bullish inclinations. This is the level where the most recent bearish correction might end.
To sum up, the price closing a day above the green area will be a signal to go long and, conversely, the price bouncing sharply off this level with a shooting star or a bearish engulfing will be a signal to go short.