NZDUSD has dropped through 0.6500/10 mark, almost 300 pips lower from 0.6800 highs this month. The currency might be preparing to produce a counter trend rally before bears are back in control. They would be inclined to push lower towards 0.6300 and 0.5950 levels respectively.
NZDUSD probable wave counts are as follows: The currency had dropped through 0.5470 around March this year. Bulls had taken control since then and managed to carve a religious rally towards 0.6800 levels. It was clearly sub-divided into 5 waves, making an impulse.
Ideally, an impulse is followed by a corrective wave in the opposite direction. The corrective wave might take shape of a zigzag or flat or a triangle. In this case, it could be a potential zigzag towards 0.5950 levels, going forward.
Also note that fibonacci 0.618 retracement of the entire rally between 0.5470 through 0.6800 is seen through 0.5950 mark. Probability for a bullish reversal remains high if prices manage to reach there. Bulls would be poised to take control back from those levels.
Looking at the lower degree wave structure, the drop between 0.6800 and 0.6500 could be marked as a lower degree Wave 1. The impulse drop is either complete around 0.6511 or might be close to terminating just below 0.6500 mark.
Traders might remain inclined to sell o a potential Wave 2 termination close to 0.6650 and 0.6700 levels respectively. The protective stop would go above 0.6800 while projected targets might be seen towards 0.5950 respectively.
Technical Analysis Team
Offering state of the art execution services through multiple top-tier liquidity providers. Abans Global provides you with a tailor-made solution to match the demanding requirements of your business, with the multi-assets offering, advanced trading platforms and FIX API connectivity that provides ultra-low latency.