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As we move into tomorrow’s BoE report, I want to take a look at a potential setup on GBPNZD. Just know that the report, which is scheduled for 15:30 GMT, is likely to produce increased volatility in all GBP pairs, so plan accordingly.
That said, I really like this wedge pattern that has developed on the 4 hour chart. The market retested wedge resistance yet again, making that the third retest. This gives us a valid pattern to watch as we move into the end of the week.
Key resistance comes in at 2.1054. This is weekly resistance dating back to 2011 as well as the neckline of a broader inverted head and shoulders pattern, best seen on the weekly chart.
Summary: Wait for a 4 hour close above wedge resistance and then watch for a retest as new support. More aggressive traders can play this on a 1 hour chart. Key resistance comes in at 2.1054. A weekly close above this level could bring about a multi-year run to 2.4464.
NZDUSD analysis
