Is EUR/NZD on it's way to the September 2018 highs, located within the 1.78000 / 1.80000 resistance zone?
Recently we have been monitoring EUR/NZD on the daily time frame and its movement since bottoming out at around 1.65330 midway throughout July.
Since then we have noticed a strong rebound which has pushed the price through the 50, 100 and 200 Smoothed Moving Averages and is beginning to confirm a Golden Cross on the daily time frame.
As of writing this article the current price is 1.69860 whilst the market is closed for the weekend, with further upside looking likely to take the price towards the area of resistance at the 1.72000 region. We will probably see a pullback at these levels whilst we convert the resistance zone into a support zone allowing the bullish momentum to recover strength.
Once support has been established at the 1.72000 region, the pathway could then be unlocked for a further test of the 1.75000 psychological resistance area; which was last reached towards the end of 2018. We are confident that these levels can be held quite easily as the price will be comfortably above the three main Smoothed Moving Averages that we have mentioned above.
In the event that we surpass the 1.75000 region, the likelyhood of hitting the 2018 highs, located at the 1.78000 / 1.80000 area, are regarded as quite high. This is due to the limited amount of resistance that is present between these levels allowing plenty of opportunity for the price to squeeze higher and test such levels.
To invalidate the above analysis, we will need to see a clear rejection at one of the levels highlighted, aswell as preferrably seeing the price drop back below the Smoothed Moving Averages on the daily timeframes to then confirm a bearish trend.
EUR/NZD Daily Chart Analysis