NZD/USD: 3 Drives

Published 01/30/2017, 12:00 PM
Updated 07/09/2023, 06:32 AM

NZD/USD is creating a lower high in the market at the top of a descending channel, thus providing an excellent area to short and continue the long-term downtrend.

The descending channel (chart shown below) has formed a valid bullish three drives pattern, which has completed points 1 and 2.

NZD/USD 4H Chart


To further validate this 600 pip move, price has now reached the 0.786 retracement level at the top of the decending channel which aligns with the D point of a bearish cypher pattern (chart shown below).

NZD/USD 4H Chart II


This has opened up an opportunity to trade with over 1:4 risk to reward.

Do not forget we have the FOMC rate statement on the 1st of February and NFP on the 3rd of February, this also provides additional reasoning for a 600 pip move.

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