The NZDUSD price has formed a new low on the 4hr time frame suggesting a reversal could be forming.
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Looking at the strength meter this week we identified that the New Zealand Dollar could reverse its recent strength. The currency reached the extreme highs on the meter where we usually see a reversal form. The USD has remained strong fundamentally as recent FOMC meeting minutes showed that many FOMC members wanted to see a 50bps rate hike. This means we could see a more aggressive federal reserve in the near future.
The chart also shows the potential for the NZDUSD price to reverse as the price begins to reject the previous weekly highs and key resistance zone. The 4hr chart also highlights that a new low has recently formed suggesting that sellers are gaining an advantage over buyers here. Now the price has made this low we can begin to look for short ideas at the previous supply zone. If the price retests this zone of interest we can look for reversal patterns and identify short trading opportunities if the price can complete these patterns.
Do you trade GBPAUD? you can watch our analysis of the forex pair here.
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