After a very long downtrend, EUR/NZD finally shows signs of strength. On May 29, the pair broke above the downtrend trendline which was followed by a breakout of the key resistance area (around 1.56).
Fibonacci levels applied to the trendline breakout point show a clear break above 38.2% level, that is currently acting as a support S1 ( 1.5571). At the same time, the pair broke 200-day moving average from below, which is another confirmation of a very bullish tendency in the mi- to-long-term future.
Consider buying EUR/NZD between the current level (1.5746) and S1 support (1.5571) targeting at R2 (1.6620) that is 0% Fibonacci. Although, it is better to wait for a corrective move down. However, with such a high volatility and extreme bullish trend, there might not be any reasonable corrective move down. Only a break below S2 could result in prolonged downside correction and potentially wide range trading.
Support: 1.5571, 1.5249, 1.4927
Resistance: 1.5973, 1.6620
The material has been provided by InstaForex Company – www.instaforex.com