NZD/USD Price Analysis: Attempting to break out of top of range

NZD/USD is testing the ceiling of its sideways range. A break above the August 20 high would probably confirm an upside breakout with substantial gains on the horizon. 

NZD/USD 4-hour Chart 

The pair temporarily breached the ceiling of its range on August 20 when it rose up to a high of 0.6248 before rapidly falling back down and forming a bearish Gravestone Doji candlestick in the process. This was followed by only a short period of weakness down to the 0.6109 August 22 swing low, however, before the pair recovered and broke back out of the range again on August 23. 

Since then, NZD/USD has pulled back down slightly a break above the 0.6248 August 20 highs, achieving a higher high would probably signal a decisive breakout. Such a breakout would activate the upside target, calculated as the 0.618 ratio of the height of the range extrapolated higher. This gives an upside target of 0.6448 (bold rectangle). Another, more conservative target lies at 0.6409 (December 2023 high). 

Such a move would probably also change the short-term trend from sideways to bullish.

A break below the 0.6109 swing low, however, would reconfirm the sideways trend as intact and likely to extend, with a probable down move towards the range lows in the 0.5850s.