NZD/USD Technical Analysis: Teasing inverse head-and-shoulders breakout
- NZD/USD has carved out an inverse head-and-shoulders pattern on the daily chart.
- The key indicator suggests scope for a rise to the 100-day moving average.
- A close above 0.6433 is needed to confirm a bullish breakout.
NZD/USD is looking north with the daily chart teasing an inverse head-and-shoulders breakout – a bullish reversal pattern.
The pair is currently trading just above the neckline resistance of 0.6433 with the relative strength index (RSI) signaling a bullish bias with an above-50 print.
The Kiwi, therefore, looks set to test the 100-day average lined up at 0.6463.
A close above 0.6433 is needed to confirm an inverse head-and-shoulders breakout. That would create room for a rally to 0.6662 (target as per the measured move method).
The outlook would turn bearish if a strong rejection at 0.6433 is followed by the invalidation of higher lows via a drop below 0.6333 (Oct. 30 low).
Daily chart
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Trend: Bullish
Technical Levels
Author
Omkar Godbole
FXStreet Contributor
Omkar Godbole, editor and analyst, joined FXStreet after four years as a research analyst at several Indian brokerage companies.
