GBP/NZD comes back to the bearish trend
|Today, I have a real treat for the technical traders, especially those that use patterns and Fibonacci retracements. This piece is about the current situation on the GBPNZD, where we have a very handsome bearish situation with the pair respecting all major, price action principles.
End of the flag
Since the beginning of the year, GBPNZD is in an uptrend. Drop traditionally was sharp and then we entered a correction stage, which had much lower volatility. Correction is a beautiful flag pattern (black), which actually came to an end this week. What’s remarkable here is that the price, apparat from respecting the flag lines, also respected the Fibonacci lines. 23,6% was crucial support and the 50% was an ultimate resistance. In the meantime, we were also locally respecting the 38,2%.
One last thing
As we said, GBPNZD already broke the lower line of the flag, which technically brings back the major sell signal. Last obstacle to a full bearish mode is a 23,6% Fibo, once it will be broken, even those unconvinced yet could join the selloff. The potential target is at April low. Once the 23,6% Fibo will be broken, getting there should be just a matter of time.
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