|NZDUSD - Daily chart|
Some items from the cons and pros list is checked. First of all the top line of the corrective channel behaved as a resistance. The price action on the weekly and daily chart is still form a wedge, EWP wise it looks like and ending diagonal pattern. The test of the lower line was successful.
The RSI on the weekly time frame has not reached the sustainable bullish zone and toped at the limit of the bearish resistance zone, while the daily RSI reached the sustainable bullish zone for one period and turned down and right now at the bullish support. The momentum of the 4 hours time frame looks bearish to me. All local low reached the sustainable bearish zone while the pull backs stopped in upper grey zone.
|NZDUSD - 4 hours chart|
The first bigger support level is pierced while last week the price was above it. Although I still cannot rule out that a strong pull back may come in a bearish scenario as well. I marked a small rectangle which is the maximum zone of a complex flat correction. Below this zone I can only think of one immediately bullish scenario. The 1-2-i-ii patterns sometimes form a triangle. So the correction from 13th of September until the 4th of October formed a triangle. Triangle can only be in wave IV, X or B position. So if this is an actual triangle patter then the price should reverse from the lower zone of the small rectangle. This would be and ideal price target for a thrust after a triangle pattern. This scenario may be ruled out below 0.7050. So reversal above 0.714 would suggest at least a strong pull back to 0.737 or that the ending diagonal pattern is most likely incomplete and a new high is still needed. We'll see...