The bias is strongly bullish while the price remains above 0.8434, where 200 EMA was rejected on 1H chart.

Disclaimer: The analysis presented in this article is for educational purposes only and should not be considered as financial advice.

This analysis was done on MetaTrader 4.

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Trade Idea Details:

NZD/CAD symbol

Type: Bullish

Key support levels: 0.8400, 0.8434

Key resistance levels: 0.8515, 0.8652

Price Action: NZD/CAD broke above the downtrend trendline as well as 200 Simple Moving Average. On April 9th, the price rejected the 200 SMA and produced yet another high. Currently, higher highs and higher lows are being printed suggesting further price increase. At the same time, the 61.8% Fibonacci retracement level at 0.8460 is still holding, which means that as long as price stays above this support, price is very likely to rise.

The key resistance level and the potential upside target is seen at 0.8654 which is confirmed by two Fibonacci retracement levels. First is the 88.6% Fibs and second is the 327.2% Fibs applied to the most recent corrective wave down.

Below is the 1-hour chart we can see a clear rejection of the 200 Exponential Moving Average, which shows bullish domination, at least in the short or medium term. If this is the case, NZD/CAD could start producing a final – 5th wave up, based on the Elliot Wave theory.

Potential Trade Idea: The current price looks attractive in terms of buying opportunity, although the buying area is seen between 0.8435 – 0.8475. The stop loss should be below the point of the previously formed low, or the point where price rejected the 200 SMA on the 4H chart. This is the 0.8400 psychological level, and 4h break and close below this price will invalidate bullish outlook. In regards to the upside target, there is only one strong resistance corresponding with two Fibonacci retracement levels and located at 0.8652.