Good morning traders! Today we will analyze NZD/USD in multiple timeframes to show you a potential bearish opportunity. We must highlight the term POTENTIAL since the setup is not ready yet, and we need certain conditions to be met first.
🔸First of all, we are going to analyze the Weekly chart, which is where this bearish view comes from:
The price was strongly rejected in the resistance zone. The next area where we consider that there may be a reversal is in the support zone. This enables us to look for a bearish scenario in a lower timeframe.
🔸In the Daily chart (published), we see that the price is against a local support zone, slightly penetrated, but the breakout is not confirmed yet.
Of course, there is still the possibility that this is a false breakout, and the price will return to the bullish direction.
The way to reduce this happening is to wait for a clear break + retest + rejection.
🔸In the 4H chart, we can see it more clearly:
🔸First of all, we are going to analyze the Weekly chart, which is where this bearish view comes from:
The price was strongly rejected in the resistance zone. The next area where we consider that there may be a reversal is in the support zone. This enables us to look for a bearish scenario in a lower timeframe.
🔸In the Daily chart (published), we see that the price is against a local support zone, slightly penetrated, but the breakout is not confirmed yet.
Of course, there is still the possibility that this is a false breakout, and the price will return to the bullish direction.
The way to reduce this happening is to wait for a clear break + retest + rejection.
🔸In the 4H chart, we can see it more clearly: