By: Dima Chernovolov
GBP/NZD recently broke the daily Pennant chart pattern, which was previously identified by Autochartist. Autochartist rates the quality of this Pennant at the 5-bar level – which is the result of the significant Initial Trend (8 bars), above-average Uniformity (6 bars) and higher Clarity (8 bars). GBP/NZD is expected to fall toward the forecast price 1.9281 – in line with the earlier downward reversal from the resistance area shown below.
As can be seen from the daily GBP/NZD chart below, the price earlier reversed down from the resistance area located between the key resistance level 1.9730 (which also stopped the price at the start of October), upper daily Bollinger band and the 61.8% Fibonacci correction of the sharp downward impulse from August. The proximity of this resistance area increases the probability GBP/NZD will continue to fall toward the forecast price 1.9281.