The GBP/NZD exchange rate has weakened since the test of the level 2.000, when the daily candle closed with a long wick. The declines have now brought GBP/NZD to the key support zone.

As you can see in the daily chart below, the GBP/NZD exchange rate in the second half of last week has tested an upward trend line extending from last year’s minima. This support also coincided with the key horizontal level at 1.9500.

GBPNZD Daily

Thursday’s test turned out to be positive and on Friday the quotation range was included in the previous session, which led to the creation of an inside bar. Today, however, the price is below the trend line and the mother candle minima, so there is an unconfirmed breakout from the inside bar formation and defeated support at 1.9500.

If at the close of today’s session the breakout of support (trend line and level 1.9500) is confirmed, sellers will open the way for further falls. The next key support in this scenario is around 1,9000.

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