Talking Points
- GBPNZD eyes key resistance zone-Long scalps at risk sub-2.0850
- Updated targets & invalidation levels
- Event Risk on Tap ThisWeek
GBP/NZD Daily
Chart Created Using FXCM Marketscope 2.0
Technical Outlook
- GBPNZD rally now coming into key resistance at 2.0834/48 (bearish invalidation)
- Long scalps at risk below this level zone
- Breach targets resistance objectives at 2.0910/34 & 2.1055
- Interim support at 2.0650 (near-term bullish invalidation)
- Support break targets 2.0535/59 & key support at 2.0351/62
- Daily RSI coming into 60-resistance, break keep topside in focus
- Break sub-50 with a move below the weekly ORL reinforces reversal play
- Event Risk Ahead: RBNZ Interest Rate Decision
GBP/NZD 30min
Notes:The focus is on near-term resistance just higher with divergence in the intra-day momentum signature warning of possible exhaustion. The pair has continued to trade within the confines of an ascending pitchfork off last week’s low with a breach above this resistance region risking a continuation of the broader up-trend.
Bottom line: we’ll be looking to sell rallies / short-triggers while below the highlighted resistance region just below 2.0833/48 with a break sub-2.0650 needed to reaffirm the reversal play. Such a scenario targets subsequent support objectives into the 2.0535/59 & 2.0443. More significant support rests lower at 2.0351/62.Note that this is a long-range setup with a quarter of the daily ATR yielding profit targets of 50-55 pips per scalp. Caution is warranted heading into the end of the week with a break of the 2.0650-2.0850 range to affirm our near-term directional bias.
* It’s extremely important to give added consideration regarding the timing of intra-day scalps with the opening ranges on a session & hourly basis offering further clarity on intra-day biases.
Relevant Data Releases
Other Setups in Play:
- GBPAUD Scalps Target 1.9850 Resistance Ahead of UK & AUS Data
- Post NFP Scalps Target USD Breakout - Weekly Opening Ranges in Focus
- NFP Setups in Focus- USD Breakout Plays
- GBPAUD Reversal at Interim Support- Scalps Target 1.9500
- Scalps Target USDCAD Breakout Heading Into BoC, NFPs
---Written by Michael Boutros, Currency Strategist with DailyFX
For updates on this scalp and more setups follow him on Twitter @MBForex
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