GBPNZD had a bearish week. The weekly candle came out as a strong bearish candle. However, the daily chart shows that the price had a downside pullback. The price closed within a very significant level of support which is a Fibonacci level. The price had a 50% retracement and right from there it seems to be bullish again. Today’s intraday price action suggests that today’s candle may come out as a bullish engulfing candle. If that happens, then the daily buyers may start buying the pair up to a great psychological level of 1.2000.
Let us have a look at the GBPNZD daily chart.
The chart shows that the price went up to the level of 1.2000 and started having the pullback. Last week, it came up to the level of 1.9500. Today’s candle has started its trading day with a little upside gap. It came down a little and started its upward journey again. Last Friday’s candle is an Inside Bar since it closed within last Thursday’s support. If today’s candle ends up being an engulfing candle, then it shall attract the buyers to go long on the pair. Since the price had 50% retracement, thus the price may find its next resistance at the level of 1.2000. A big round number like this always plays a big role in the market. Thus, taking the profit out at that level would be a good idea.
Let us now have a look at the H4 chart.
The H4 chart shows the price had a bounce at the level of 1.9500 earlier. At the retracement, it had a bounce again at the same level. The price came down by obeying a down-trending trend line. The trend line got breached. This shall attract the H4 buyers to go long on the pair as well. The price has been heading towards the North after the trend line breakout. An upside breakout after a consolidation would create more buying pressure here. Most significant swing high lies at the level of 1.2000. This means there is enough room for the buyers to stay long.
The GBP has a high impact news event called “Current Account” at GMT 09.30 today. The outcome of the news event is significant. If it sounds bullish, it will add more fuel to the existent buying pressure. On the other hand, if it sounds bearish, it may make the buyers wait a bit longer. The bottom line is as long as the support level is held; it is good for the bull.
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