By: Dima Chernovolov
EUR/NZD recently broke the 30-minute Head and Shoulders chart pattern, which was recently identified by Autochartist. Autochartist rates the quality of this Head and Shoulders at the 8-bar level – which is the result of the sharp Initial Trend (10 bars), significant Uniformity (7 bars) and higher Clarity (8 bars). EUR/NZD is expected to fall toward the forecast price 1.7798 – in line with the earlier downward reversal from the resistance zone shown below.
As can be seen from the daily EUR/NZD chart below, the price earlier reversed down with the daily Shooting Star from the resistance zone located between the key resistance level 1.7880 (former resistance from September), upper daily Bollinger Band and the 61.8% Fibonacci correction of the downward impulse from August. The proximity of this resistance area increases the probability EUR/NZD will continue to fall toward the forecast price 1.7798.