Forex Technical Update
NZD/USD 4H Chart 9:15AM EDT 10/25/2012
Consolidation breakout: The NZD/USD has been in a declining consolidation channel since late September through October so far. But during the 10/25 session, it broke above the consolidation pattern’s falling trendline resistance. Note the RSI breaking above 60 and tagging 70, showing some new bullish momentum in the short-term. The breakout exposes the September high near 0.8355.
Throwback: The RSI reaching 70 is also a sign of overbought condition in the near-term. There is a support/resistance pivot at 0.8263. Perhaps there will be some resistance in this 0.8250-0.8265 area for a throwback. If the market can hold above 0.82, it would be a clue that the market has turned bullish in the short-term toward 0.8355. Otherwise we might have just turned a bearish consolidation into a sideways one.
Fan Yang CMT is a forex trader, analyst, educator and Chief Technical Strategist for FXTimes – provider of Forex News, Analysis, Education, Videos, Charts, and other trading resources.
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