NZDUSD seems to have carved a meaningful top at 0.6715 handle. The currency has been in control of bears since then and has also broken below the trend line support. It is seen to be trading around 0.6532 as we write, and is expected to remain in control of bears.
NZDUSD probable wave counts are as follows: NZDUSD had carved a meaningful bottom around 0.5470 earlier in March 2020. Since then the currency has remained in control of bulls and managed to carve a series of higher highs and higher lows.
NZDUSD had rallied between 0.5470 through 0.6715 levels sub-dividing into 5 waves and terminating as an impulse wave. Normally, an impulse rally is followed by a corrective drop, which might be a zigzag, flat or a triangle pattern.
NZDUSD seems to have resumed its corrective drop lower towards 0.6000 levels. It is expected to reach there as A-B-C where Wave A could reach up to 0.6230, followed by Wave B pullback. Finally Wave C could drag lower towards 0.6000 mark.
Also note that fibonacci 0.618 retracement of the entire rally between 0.5470 and 0.6715 is seen to be passing through 0.5950 levels respectively. Probability remains high for a bullish bounce if prices manage to reach up to 0.6000 levels.
Traders might have initiated fresh short positions around 0.6600 levels, with protective stop above 0.6715 mark. The projected targets are pointing towards 0.6000 levels respectively.
Technical Analysis Team
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