NZDUSD – a layout similar to USDJPY setup described here : USDJPY – Will Inside Bar Support Head & Shoulders Pattern? – (which by the way gave more than I expected – in place of 150p gave 280p).
NZDUSD has drawn a classic Head & Shoulders pattern where neckline is at level 0.7390. Breaking this level can initially lead to declines to 0.7350 and than pair may pull back to previously broken level as a neck line retest. The range of further falls may reach 160 pips, down to around 0.7225.
What should also be taken into account is the macro data calendar in which is scheduled for Wednesday, August 9th, at 21:00 GMT announcement of the RBNZ decision on interest rates, which always can cause significant volatility on this pair. In case the neck line isn’t permanently broken- the whole setup may become invalid and breaking the level of “head” will lead to growth.
