I see a potential bearish 770 pips move for the GBP/NZD. If the fundamentals and technical information is in our favour then I see no reason why this pair will not continue lower. My analysis is based off of 3 timeframes as follows:
1) Monthly timeframe suggest a down channel with support and resistance holding. We then since 2016 had an upwards channel towards the top of resistance coming from support if one connects the lows. Since March 2020 we had gradually started a downtrend which lead to a break of the up-channel.
2) Daily timeframe shows that we are currently within a downwards channel with support and resistance strongly holding on the top and bottom of these channels, also one can see that there is a clear zone of horizontal support and resistance which we have now multiple times rejected, and we are retesting this zone now.
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3) My entry will be on the 1Hour chart, noticing that there is a Fibonacci retracement level at price 1.91100 (Daily resistance). Now price could decide to still continue past this resistance which will lead to a retest of the daily resistance trendline. I am looking to start selling GBP/NZD by these two abovementioned zones with counter trendline breaks bearish for the next 770 pips, one can also notice that the RSI indicator since 24th December 2020 to current date 16th January 2021 performed a hidden divergence signal, which provide the 4th confluence for this trade. I will stop selling when we reach the Fibonacci extension at about price points 1.83918 / 1.83242 and then relook my analysis when the time arrives.
Thank you for reading, may you have a prosperous 2021 in the forex market!
1) Monthly timeframe suggest a down channel with support and resistance holding. We then since 2016 had an upwards channel towards the top of resistance coming from support if one connects the lows. Since March 2020 we had gradually started a downtrend which lead to a break of the up-channel.
2) Daily timeframe shows that we are currently within a downwards channel with support and resistance strongly holding on the top and bottom of these channels, also one can see that there is a clear zone of horizontal support and resistance which we have now multiple times rejected, and we are retesting this zone now.
see image-
Thank you for reading, may you have a prosperous 2021 in the forex market!