Best Trade Ideas for April
I know we've had quite an amazing run these past few month, with over 78% accuracy in our trade ideas and sentiments, and thousands of pips in profits monthly...
NZD/CAD: another end of a channel?
Information is not investment advice
If we look purely technically at NZD/CAD, here is what we will see.
Throughout the entire May, with the exception of a dropdown during the third week of the month, the currency pair was moving sideways. Its movement was contained within the channel supported by 0.8482 and capped by 0.8560 from the upside. Closer to the end of the month, NZD/CAD made a surge above the channel’s upper border at point A. After that, it bounced down, stayed at the upper border again, bounced down again, and broke the channel to establish itself at a higher baseline level.
Eventually, it is now in a new sideways channel since the beginning of June: the lower border is at 0.8717, the upper border is at 0.8790. Now, just recently NZD/CAD inched above the resistance of the channel at point B, bounced down, and currently is in consolidation at the upper border. If it follows the same pattern it formed in May, we are going to expect some more consolidation right below 0.8790, then a bounce down, and eventually a sharp rise to a new baseline level.
Important: following the pattern doesn’t necessarily mean copying it. Probably, it would even be unwise to expect exactly the same behavior from NZD/CAD as in the previous month. For this reason, what we are to expect is a shift that will push the price out of the month-long sideways channel. It may be a bullish move to a higher base like at the beginning of June, it may be the opposite, in fact, or it may be just an end of the sideways pattern. So the first thing to prepare for is the end of the sideways channel. After that, market sentiment and fundamentals will tell how exactly it will end and what may come next.
In the short term, though, expect consolidation at the resistance level and a bounce back. If that fulfills, let’s get back to the currency pair and refresh the outlook.
Similar
CAD Might Weaken As Oil Market Plunges
Futures for Canada's main stock index rose on Monday, following positive global markets and gains in crude oil prices. First Citizens BancShares Inc's announcement of purchasing the loans and deposits of failed Silicon Valley Bank also boosted investor confidence in the global financial system...
Bitcoin & Gold - Safe Haven Amid Bank Crisis
Investor confidence in the global financial system has been shaken by the collapse of Silicon Valley Bank and Credit Suisse. As a result, many are turning to bearer assets, such as gold and bitcoin, to store value outside of the system without...
Popular
What Will Happen with the Euro? An Economic Perspective.
eurusd-is-falling-what-to-expect-from-the-future-price-movement
Will Australia's "Rampant Inflation" Prevail in May?
Greetings, fellow forex traders! Exciting news for those with an eye on the Australian market - the upcoming interest rate decision could be good news for Aussies looking to refinance or take out new loans. The Mortgage and Finance Association Australia CEO, Anja Pannek, has...
How Will BoJ Meeting Affect the Yen
Hold onto your hats, folks! The Japanese yen took a nosedive after the Bank of Japan (BOJ) left its ultra-loose policy settings unchanged, including its closely watched yield curve control (YCC) policy. But wait, there's more! The BOJ also removed its forward guidance, which had previously pledged to keep interest rates at current or lower levels. So, what's the scoop? Market expectations had been subdued going into the meeting, but some were still hoping for tweaks to the forward guidance to prepare for an eventual exit from the bank's massive stimulus
Choose your payment system
