Daily Forex Update: GBP/NZD
By: Dima Chernovolov
GBP/NZD continues to rise inside the 4-hour Down Channel chart pattern which was recently identified by Autochartist. Autochartist measures the quality of this Down Channel at the 6-bar level – which reflects the sharp Initial Trend (10 bars), lower Uniformity (4 bars) and above-average Clarity (6 bars). GBP/NZD is expected to rise further inside this Down Channel – in line with the earlier upward reversal form the major support area highlighted below.
As can be seen from the weekly GBP/NZD chart below, the bottom of this Down Channel formed when the pair reversed up from the powerful support area lying between the long-term support level 1.8650 (low of the weekly Hammer from January) and the lower weekly Bollinger Band. The proximity of this support area and the oversold reading on the weekly Stochastic indicator increase the probability GBP/NZD will continue to rise inside this Down Channel.
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