- NZD/USD trades 0.33% higher on Thursday as risk sentiment improves.
- There is a triangle pattern on the 60-minute chart and the price has tentatively broken out.
NZD/USD 60-minute chart
NZD has been a currency that is very sensitive to risk at the moment. All of the FX pairs have been moving off the back of USD strength when it is risk-off and USD weakness when stocks rally. Recently the RBNZ even told markets that they are considering negative rates and after a brief decline the price moved above the wave highs again.
Looking at the price action more recently and it looks like there is some potential of a topping pattern. The market has been making lower highs but also higher lows at the same time. This brings us a triangle formation that you can see in the hourly chart below. In the last hour, the price has printed above the pattern albeit very tentatively.
Just above the pattern, the 200 Simple Moving Average lies in wait along with the resistance zones of the wave highs above. The MACD and Relative Strength Index (RSI) indicators are looking positive. The MACD histogram is green and the signal lines have crossed above the mid-line. The RSI is above 50 and there is still room to the upside. The trend on the higher timeframes is clearly up but if this pattern can break to the downside conclusively then a reversal could take place.
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