Few months ago, the NZD/USD pair established a consolidation zone that extended between the price levels of 1.7620 and 1.7870.
On January 20, bears managed to execute a successful breakout below the major DEMAND level at 1.7620.
Shortly after, a bearish decline took place towards the price level of 0.7200 where bullish pressure has been applied during the past few weeks.
The H4 chart shows an inverted Head and Shoulders pattern that originated off the price level of 0.7200. Estimated bullish projection target is located near the price level of 0.7676.
The price level of 0.7630 corresponds to the 61.8% Fibonacci Level as well as the lower limit of the broken consolidation zone depicted on the chart.
That is why the price zone of 0.7630-0.7670 is a significant SUPPLY ZONE to be watched for low-risk SELL entries. Stop Loss should be placed above 0.7700.
The material has been provided by InstaForex Company – www.instaforex.com