Good day traders! During my previous update on the NZD/CHF back in early March, I expected support to step in and turn price higher but the huge sell-off that started in December last year continued and blasted straight through my proposed support zone.
Eventually, the NZD/CHF found support in mid-March and reversed higher, leaving a v-shaped bottom behind. If you look back at a larger set of historical data, like on the weekly timeframe above, then this sudden reversal seems to be a normal past occurrence where price aggressively sells off and then suddenly reverses higher.
A closer look at the price action since the March low shows that the NZD/CHF could be heading towards the recent high at 0.6298, and should this happen, then price might run into strong resistance that lies between 0.6275 – 0.6410.
It is currently possible to count 3 waves higher, with a 5th wave probably underway now. After 5 waves it would be reasonable to expect a correction to take hold unless my proposed 3rd-wave was an important high and a longer-term corrective phase has already started.
Either way, I’m cautiously bullish towards the recent high at 0.6298 and expect a larger corrective phase to take hold soon.
More updates to follow.
Bias: Cautiously bullish towards 0.6298
Potential Resistance: 0.6275 – 0.6410
Until next time, happy and safe trading!