We’re watching the EURNZD daily chart this session, just recently this market has broken out of long term ranging conditions. This week the market has rallied up and is now tested the breakout level of the old range bottom support.
This is what me call a breakout and retest event, and these guys generally product decent price action reversal signals. The area is also lining up with the dynamic resistance qualities of the trend mean value so this stew of confluence creates a nice hot spot on the chart for bearish price action signals to form.
There is currently a 4 hour sell signal, but we will wait to see how the daily candle closes before pulling any triggers. So we will reassess these chart at the New York close and look for any trading opportunities.
Previously we discussing the EURNZD cross pair market and pointed out that price was approaching a key level in the market. The old range support was going to be tested as resistance and we anticipated a sell signal.
Last session a 2 Candle Reversal pattern formed, demonstrated clear bearish rejection of that significant daily level, this was a classic ‘breakout & retest’ type trade setup that is discussed in the Price Action Protocol trading course.
With the presence of a bearish signal at this key area, we can expect lower prices to flow on the back of this setup.