Hi Traders! EURNZD technical analysis and short term forecast post is here. We do our analysis on the MetaTrader4 platform (MT4), some very interesting, useful tips and hacks about the MT4 platform could be found here. As we do in every technical analysis post we are going to perform the multi-timeframe technical analysis on this pair in order to find possible trading opportunities. If you would like to learn more about the way we trade and the technical analysis we use then check out the Traders Academy Club Spoiler alert – free memberships are available! Let’s start our analysis now from the highest timeframe which will be the daily chart here.
EURNZD D1(Daily) Chart Analysis – Strong Support Zone, Bullish Hidden Divergence, Parabolic Sar
On the daily chart, the price which was moving lower reached a strong support zone respected it and bounced higher from this zone. Also, we could see that the price which was moving lower has created a bullish hidden divergence between the first low that has formed at 1.58732 and the second low that has formed at 1.67347 based on the MACD indicator, which we may consider as evidence of bullish pressure. In addition to this, based on the Parabolic Sar we could see that the dot is below the price which we may consider as yet another evidence of bullish pressure. Also, currently there are no signs opposing this bullish view. So everything looks good here for the bulls and we may now move down to lower timeframe and look for evidences supporting this short term bullish view.
EURNZD H4(4 Hours) Chart Analysis – Bullish Convergence, ADX Indicator
Looking at the H4 chart, we could see that the price which was moving lower has created a bullish divergence that has formed between the first low that has formed at 1.68510 and the second low that has formed at 1.67347 based on the MACD indicator. The price then moved higher and broke above the last high at 1.69677 creating higher highs, thus forming a classical setup of bullish divergence followed by bullish convergence, we may consider these as evidences of bullish pressure. Hence as per the book scenario, after a bullish convergence, we may look for corrections to happen and then further continuation to the upside. Currently, it looks like a correction is happening. In addition to this, the ADX indicator gave a bullish signal here, at the cross of +DI (green line) versus -DI (red line) and the main signal line (silver line) reads value over 25, we may consider this as yet another evidence of bullish pressure. Until the strong support zone shown in the image below (marked in blue) holds my short term view remains bullish here and I expect the price to move higher further.
Technical Analysis & Forecast Summary
EURNZD D1(Daily) Chart Analysis
- Strong Support Zone, Bullish Hidden Divergence, Parabolic Sar
EURNZD H4(4 Hours) Chart Analysis
- Bullish Convergence, ADX Indicator
Trading Tips
It is always recommended to look for confirmations before you jump into any trade. If you are not sure about how to trade this short term buy setup then you can use any setup and strategy that you have in your arsenal to look for bullish moves and join this buy trade.
Also, don’t forget to protect your buy trade using a stop loss and make sure to set a target and keep a proper risk/reward ratio.
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Happy Trading!
Arvinth Akash
Traders Academy Club Team
