A steep downtrend on the daily chart of the New Zealand dollar versus the Swiss Franc recently consolidated in a double top with a slanting neckline. The pattern further broke out followed by a confirmation candle a sign that the downtrend may persist. Price is currently at a very significant support zone. With our main trend being bearish and a pattern breaking out below we are already forming a bearish bias .
As much as we have concluded that sellers are in control if this market, price action is going to guide as moving forward on the next market state. At the significant level, price may be supported resulting in a reversal or break through and carry on with the waterfall of prices.
On the daily chart of the British Pound versus the Canadian dollar, there’s an occurrence of a head and shoulder pattern that has taken a month to form. We have been closely monitoring this currency pair having featured it at the first week of the year, where we concluded it was at the resistance level of a descending channel. A head and shoulder pattern forming at the resistance level of the channel further strengthens our bearish bias. Price broke out of the neckline and receded back above the neckline.
This could be a retest of the neckline but only time and price action confirmation will tell. If the neckline is successfully tested and price breaks out below, then very high chances are that we will see bears coming in and pushing prices lower.
Disclaimer: This analysis is for educational and general information only and not advice or a recommendation to trade or invest. Do your own research/analysis and don’t blindly enter trades based on the analysis.