Trade of the Day: NZD/USD

By: Dima Chernovolov

NZD/USD continues to fall inside the hourly Down Channel chart pattern which was identified recently by Autochartist. Autochartist rates the quality of this Down Channel at the 4-bar level – which reflects the slow Initial Trend (3 bars), lower Uniformity (1 bar) and strong Clarity (8 bars). NZD/USD is expected to fall further inside this Down Channel – in line with the earlier breakout of the pivotal support level shown below.

As can be seen from the daily NZD/USD chart below, the pair earlier broke below the support level 0.6260 (which reversed the price twice in September). This price level is acting as a significant resistance after it has been broken. The proximity of this resistance level and the strength of the daily downtrend add to the probability NZD/USD will continue to fall inside this Down Channel.