Trade of the Day: NZD/CAD
By: Dima Chernovolov
NZD/CAD continues to fall inside the well-formed Down Channel chart pattern which was previously identified by Autochartist on the 15-minute charts. Autochartist measures the quality of this Down Channel at the 8-bar level – which is the result of the strong Initial Trend (7 bars), near-maximum Uniformity and Clarity (9 bars). NZD/CAD is expected to fall further inside this Down Channel – in line with the earlier breakout of the key support area shown below.
As can be seen from the daily NZD/CAD chart below, the price earlier broke the support area lying between the key support level 0.8780 (low of the daily Hammer from the start of May) and the 50%Fibonacic correction of the previous upward impulse from September. This price zone is acting as resistance area after it was broken. The proximity of this resistance area increases the probability NZD/CAD will continue to fall inside this Down Channel.