FX.co ★ EUR/NZD: Analysis for January 08, 2014

Overview:

Since our last analysis, the EUR/NZD pair has been trading downward movement, price tested level of 1.6382 on very high volume (selling climax). As you can see on the 1H chart, there is a selling climax, which is the sign of bullish strength. Since our FE 161.8 % is held successfully, selling EUR/NZD looks very risky. Anyway, to confirm bullish continuation and end of bearish corrective phase, we need good volume background and strong demand on the market, and also supply to disappear from the market. Be careful with selling EUR/NZD since we may see bullish continuation. Currentlyб the price is trying to test again FE 161.8% at 1.6363 from the most recent swings. If the price breaks the area of 1.6500, we may see test of FR 61.8% at 1.6570. In case the price continues with downward movement, we may see testing of FR 61.8% at 1.6325 and potential bullish continuation from that point. Anyway, selling near the lows is very risky so watch for buying opportunities after bearish correction.  

Daily pivot Fibonacci points:

Resistance levels: 

R1: 1.6484

R2: 1.6504

R3: 1.6537

Support levels:

S1: 1.6417

S2: 1.6397  

S3: 1.6363  

Trading recommendation: Be careful with selling the EUR/NZD pair and watch for buying opportunities after bearish correction.