Trade of the Day: NZD/CAD

By: Dima Chernovolov

NZD/CAD continues to decline inside the clear daily Down Channel chart pattern which was recently identified by Autochartist. Autochartist rates the quality of this Down Channel at the 5-bar level – which is the result of the slow Initial Trend (1 bar), below-average Uniformity (4 bars) and significant Clarity (8 bars). NZD/CAD expected to fall further inside this Down Channel – in line with the earlier downward reversal from the resistance area shown below.

As can be seen from the daily NZD/CAD chart below – the pair earlier reversed down from the resistance area lying between the key resistance level 0.8600 (former strong support from December and January) and the 38,2% Fibonacci retracement of the previous sharp downward impulse from December. The proximity of this resistance area increases the probability NZD/CAD will continue to fall inside this Down Channel.