Hi Traders! GBPNZD short term forecast and technical analysis 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. 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 from the highest timeframe which will be the daily chart here.
You can watch the video explanation of this idea here
GBPNZD D1(Daily) Chart Analysis – Strong Resistance Zone, Potential Bearish Divergence, Stochastic Oscillator
On the daily chart we had a bullish rally, currently it looks like this bullish rally has completed itself, as the price reached a strong resistance zone, respected it and is bouncing lower from this zone. Generally, after a bullish rally we may expect corrections and then further continuation higher. We also have a potential bearish divergence that is forming between the first high that has formed on 18th June 2021 and the second high that has formed on 13th July 2021 based on the MACD indicator which we may consider as evidence of bearish pressure. Also based on the Stochastic Oscillator we could see that the price has reached its extreme we may consider this as yet another evidence of bearish pressure. We may now move down to one timeframe lower and look for evidences supporting this short term bearish view.
GBPNZD H4(4 Hours) Chart Analysis – Bearish Convergence, Strong Resistance Zone
On the H4 chart, the price has created a bearish divergence between the first high that has formed at 1.99282 and the second high that has formed at 1.99561 based on the MACD indicator. The price then moved lower and broke below the low at 1.98250 creating lower lows, thus forming a classical setup of bearish divergence followed by bearish convergence. Hence as per the book scenario, after a bearish convergence, we may look for possible corrections and then further continuation to the downside. Currently it looks like a correction is happening. So the bottom line here is that the H4 chart has evidences supporting the bearish view. Until the strong resistance zone shown in the image below (marked in blue) holds my short term view remains bearish here and I expect the price to move lower further.
Technical Analysis & Forecast Summary
GBPNZD D1(Daily) Chart Analysis
- Strong Resistance Zone, Potential Bearish Divergence, Stochastic Oscillator
GBPNZD H4(4 Hours) Chart Analysis
- Bearish Convergence, Strong Resistance Zone
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 sell setup then you can use any setup and strategy that you have in your arsenal to look for bearish moves and join this sell trade.
Also, don’t forget to protect your sell trade using a stop loss and make sure to set a target and keep a proper risk/reward ratio.
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To your success,
Vladimir Ribakov
Certified Financial Technician
