EUR/NZD Looking to Rally Out of a Triangle Formation
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EURNZD price action has been coiling up the past three weeks, forming a well-developed triangle formation. At the time of this writing price is coming out of the pattern on the 4-hr time-frame, which is enough to be considered a valid trigger. Seeing a solid daily close will help further conviction.
The height of the formation points to a measured move of around 300 pips, or for a rally to around 17800. That is of course only a measured target, there are some ‘real’ levels to consider along the way towards higher prices.
The first level up as resistance is the top of the pattern at 17616, followed by a trend-line running down off the 2015 high over last year’s high. Beyond the trend-line the 2018 high at 17928 is the first major swing level, but it could take some time before that is achieved.
A healthy breakout from a triangle shouldn’t see price dip too much inside the pattern, thus stops placed well below the top-side trend-line should be out of harm’s way.
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EURNZD 4-hr chart (triangle breakout in progress)
EURNZD Daily Chart (tri break towards higher levels)
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---Written by Paul Robinson, Market Analyst
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DailyFX provides forex news and technical analysis on the trends that influence the global currency markets.