EUR/NZD 4H Chart: Descending Triangle
- The common European currency is trading against the New Zealand Dollar in a descending triangle that is about to be broken.
- The pattern started to form after a 1.84% appreciation of the Euro amid Mario Draghi speech.
- From technical perspective, triangles are continuation pattern, which in this case mean that the rate has to make a breakout to the top.
- This scenario is additionally supported by the fact that the lower support line is also protected by a combination of the monthly PP at 1.5586 and the 200-period SMA at 1.5580.
- On the other hand, descending triangles, in particular, usually drive the currency pairs to the south.
- The validity of this outcome is supported by the fact that the road upstairs is blocked by a combination of the 55- and 100-period SMAs and the weekly PP at 1.5689.
