By Orbex
EURNZD has been on a retrace ever since it matched 10-year highs last week at 1.9927.
Technically, the pair is looking set to test back those highs and carving new ones, eventually.
However, at the present, we are likely to see deeper pullbacks ideally towards the 1.76 handle, before potentially reversing the course back upwards.
The weekly chart above points to the 1.76 handle as the main resistance of the channel. That was broken last week. If it comes back into play, it will likely act as strong support now.
The blue line above is an initial support structure (previous resistance), making it an initial downward target of the current retrace, coming roughly at the 1.83 handle.
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If the 1.76 handle gets a test and provokes bounces, we could get going for a move back higher.
The 2-hour chart below sketches the very scenario. Price has broken outside of the symmetrical triangle and carries the potential for a move towards 1.83XX levels.
Under 1.83, the possibility of a deeper correction towards 1.76 becomes more likely. This is evident from the weekly and even the 2 hours charts, as there isn’t truly any strong support until the 1.76 handle, with the exception of the psychological 1.80 handle.
By Orbex
