Believe it or not I’m actually trying to cull the number of Forex pairs I watch. However, I’ve seen so much chatter about the GBP/NZD that I couldn’t resist pulling up a chart.
As always I start looking at the monthly chart and that is when this pair grabbed me. Some girls like shopping….I like charts! It’s not technically ideal but there is a definite form of a bullish ‘inverse H&S’ pattern building on the monthly chart. The ‘neck line’ is at the 2.10 region:
GBP/NZD monthly:
The ‘Height’ of this pattern from ‘Head’ to the ‘Neck Line’ is around 3,300 pips. Thus, technical theory would suggest that any bullish breakout would extend by the same order of magnitude. A 3,300 pip move would bring this pair up to the 2.43 region. For added confluence this happens to be the 50% fib pullback level of the last major bear move here from 2006-2013.
GBP/NZD weekly: price is currently trading just under this key resistance level:
GBP/NZD daily: September has been a good month for this pair:
GBP/NZD 4hr: the 4hr chart shows that this pair has rallied for the last 3 weeks and, thus, a bit of a pull back could be in store before any potential bullish breakout. The 61.8% fib of this recent bull run is down near the 4hr 200 EMA and would make a good target for any possible pull back:
Summary:
- The GBP/NZD looks to be forming a bullish ‘inverse H&S’ on the monthly chart with a neck line at 2.10.
- The height of this H&S pattern is 3,300 pips and suggests a 3,300 pip move for any bullish break and hold above the 2.10 level.
- I suggest watching for any bullish monthly break and hold above the neck line at 2.10.
- The GBP/NZD could pull back after this recent rally and the 2.0 level, which is near the 61.8% fib and 4hr 200 EMA, looks like a reasonable pull back target.
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