- NZD/USD has created a double top pattern on the hourly chart.
- The daily chart indicator is reporting overbought conditions.
NZD/USD has formed a double top bullish reversal pattern on the hourly chart with neckline support at 0.6546.
Acceptance below the neckline would confirm a double top breakdown and open the doors for 0.6517 (target as per the measured move method).
The hourly chart MACD histogram is already reporting bearish conditions with a below-zero print. Further, the 14-day relative strength index (RSI) is hovering above 70, signaling overbought conditions.
So, a double top breakdown cannot be ruled out – more so, as traders now see the Federal Reserve keeping rates on hold until after November 2020 Presidential Elections.
Prior to Friday’s blowout Nonfarm Payrolls data, traders were expecting the Fed to deliver one rate cut in 2020.
Daily chart
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Trend: Pullback likely
Technical levels
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