Weekly Chart
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A broken 1.7892 level will leave little to the 1.7843 demand area, where the rate has found support based on daily closing prices for the last two months or so. The pair faces some resistance inside of the pattern as well, as the 4-hour chart shows the Senkou Span B occupying 1.8047, where it is likely to cause a hitch as the rate moves outside of the bearish cloud, in which it has been undergoing a correction. The next tough level will test the pair's weakness around 1.8000 where the lower Bollinger band will try to hold GBP/NZD movements to prevent it from falling underneath. Additionally, Tenkan sen is at the confluence point with Kijun sen, suggesting that a strong bearish signal will add ground to the falling scenario.
4 Hour Chart
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Upside risks still in the picture
Meanwhile, technical indicators fail to show a unanimous vote in favour of a continued bear trend, casting doubt in our falling scenario. In case the rate does not drop, 1.8106 will fight back against developments above the level, shifting risk to 1.8144 if a break above occurs. A more solid supply level rests at 1.8189 just above the monthly Pivot Point at 1.8179.
While the economic calendar kept the GBP/NZD market calm on Friday, Tuesday and Wednesday, September 21 and 22, are likely to bring volatility as high impact data comes out both in New Zealand and the United Kingdom. An announcement on the New Zealand Official Cash Rate as well as the RBNZ Statement could shake the markets, with MPC Member Cunliffe speech along with other less significant announcements could prolong market instability.
Aggregate Technical Indicators
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