NZD/USD technical analysis: Weekly close is pivotal
|- NZD/USD charted a bullish engulfing candle last week - a sign of potential bullish reversal.
- A trend change would be confirmed if the pair closes above 0.6444 on Friday.
The NZD/USD pair is currently trading at 0.6426, having hit a high of 0.6437 a few minutes before press time.
The pair has eked out gains in the last five trading days. That is NZD's biggest daily winning streak since the end of June.
More importantly, NZD/USD created a bullish engulfing candle last week, which occurs when the period begins on a pessimistic note but ends with optimism, engulfing the preceding period's price action.
A bullish engulfing is considered a sign of bearish-to-bullish trend change if it appears at the low of an established downtrend, which is the case with NZD.
The trend change, however, is confirmed, only if the follow-through is positive. Hence, a weekly close above the engulfing candle's high of 0.6444 is needed to confirm a bullish reversal.
Weekly chart
Trend: Bullish
Pivot points
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