NZD/USD 4H Chart: Channel Down

Source: Dukascopy Bank SA
© Dukascopy Bank SA
As NZD/USD was unable to rise past 0.7745, the currency pair is now forming a bearish channel. Accordingly, the overall outlook is negative. However, in the short run there is an increased possibility of a rally, considering that the exchange rate is fluctuating just above the lower boundary of the pattern. The potential gains should be limited by the falling resistance line at 0.71. Alternatively, if the bearish pressure prevails and 0.69 is broken to the downside, the next target will be 0.68, where the daily S2 merges with the 2010 Jun low. As for the sentiment in the market, the traders are mostly bearish, but the advantage is relatively small, merely 10 percentage points.
© Dukascopy Bank SA
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