NZDUSD plunges, about to confirm a double top pattern


The Kiwi is down for the fourth consecutive day on Wednesday, and at the time of writing, the NZDUSD pair was trading more than half a percent weaker, hovering near 0.6590. That is one-month lows for this currency pair. 

Last week's rally ended exactly at September' highs, and the kiwi has been down each day since. It looks like a very nice double top pattern, which is a reversal bearish formation. At the moment, the kiwi is breaking below the support of this formation, which might be a confirmation of the double top. 

Therefore, if the NZDUSD pair closes below 0.66 on a daily basis, the short-term trend could change to bearish. The full potential of this formation is circa 200 pips (or 3%). Thus bears will be targeting the 0.64 level in the medium-term.

However, before then, there seems to be very strong support near the 0.65 threshold, which has held many times in August. 

Alternatively, if the pair starts rallying, it needs to push above the 0.66 handle to stabilize. Afterward, the kiwi might continue higher to 0.6650, where another selling zone is probably located. 
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