I wrote about the potential for GBPNZD to trend lower on October 26th.
We were watching how the pair reacted to the bottom of a long-standing ascending channel.
One thing I mentioned is that GBPNZD needs to close below support to open up downside targets.
That never happened.
Instead, GBPNZD bounced from channel support.
However, the lower highs recently point to an imminent breakdown.
That was a key point in my October 26th post.
Sure enough, GBPNZD has trended lower since that time and is once again testing critical support.
Just keep in mind that a close below trend line support may not be enough.
In my opinion, it’s going to take a weekly close below the 1.9050 level to confirm the breakdown.
Of course, that doesn’t have to stop you from scaling in if you choose to do so.
Notice how 1.9050 was support between July and September.
A weekly close below 1.9050 would open the door to the 1.8280 region.
Alternatively, a move above the recent high at 1.9800 would negate or at least delay the bearish outlook.
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