GBPNZD has been off my radar for several months now. However, the bearish price action that resulted from yesterday’s session is intriguing for a few reasons.
Aside from the brief higher high in May, the pound cross has been in a relatively steep downtrend since September of last year. This makes yesterday’s bearish signal congruent with the prevailing trend.
It was also a rejection from a critical level that dates back to August of 2015. This level previously served as support between August of last year and February of this year before the Brexit-inspired selloff put the pair below the key handle.
And finally, yesterday’s bearish price action formed immediately following Monday’s inside bar. Technically, that makes the pattern an inside bar pin bar combination, a pattern that is often more reliable than a standalone pin bar.
The last 48 hours could be a sign that this seven-day relief rally has run its course. If this is true, a move back toward recent multi-year lows at 1.7700 could be in the cards.
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