Hi Traders! GBPNZD technical analysis and forecast post is here. The way I would like to analyze the chart for setups is based on multi-timeframe confirmations because in my POV if we get more evidences on different timeframes for the same direction then it makes the setup much more reliable. 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.
On the daily chart, we had a strong support zone and the price which was moving lower has broken below this and held below it. After the breakout this strong support zone is acting as a strong resistance zone for us. Currently the price which is moving higher has reached this strong resistance zone, respected it and is bouncing lower from this zone. In addition to this, the price has created a bearish hidden divergence between the first high that has formed at 2.05327 and the second high that has formed at 1.94705, based on the MACD indicator, which we may consider as evidence of bearish pressure. In addition to this, we have a continuing bearish divergence that has formed between the first high that has formed at 1.94705 and the second high that has formed at 1.96734 based on the MACD indicator which we may consider as another evidence of bearish pressure. Looking at the Parabolic Sar we could see that the dot is above the price which we may consider as yet another evidence of bearish pressure. We may now move down to lower timeframe and see if we can find evidences supporting this bearish view.
On the H1 chart, the price which is moving lower has created a bearish trend pattern in the form of three lower highs, lower lows which we may consider as evidence of bearish pressure. Generally, after a bearish trend pattern, we may expect corrections and then further continuation lower. Currently it looks like a correction is happening. In addition to this, the price has created lower lows based on the MACD indicator which is a sign of gaining momentum towards the bearish side. Also, we had two strong support zones that has formed and the price which is moving lower has broken below these zones and is holding below them, we may consider this as yet another evidence of bearish pressure. Currently, these strong support zones are acting as strong resistance zones for us. Until these two strong resistance zones (marked in red) hold my view remains bearish here and I expect the price to move lower further.
GBPNZD D1(Daily) Chart Analysis
GBPNZD H1(1 Hour) Chart Analysis
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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Happy Trading!
Arvinth Akash
Traders Academy Club Team.
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