Monthly chart
Daily Chart
GBP/NZDAs I was looking over my charts today I found this cross very interesting.
As we can see on the monthly chart, a major zig zag decline has been unfolding since October 2000. Wave C is almost equal to wave A and last month we saw a morning star candle develop. A morning star is signaling a possible change in the trend, as it's with all candles they need to be confirmed, which of cause is also the case here. A bullish candle i May will indicate, that an important bottom is in place at 1.7699 and a rally towards strong resistance at 2.4262 could be developing.
If we zoom in on the last part of the decline (see the daily chart) we can see a similar zig-zag as on the monthly chart. We even have fractal bottoms in February 2012 and in April 2013. Wave C was equal, within 23 small pips, to wave A. On the daily chart we have a confirmed divergence, which also indicates, that an important bottom is in place. That said, I would like to see a break above the base channel resistance line, which will indicate, that wave iii is developing. At this point I would like to see support at 1.8180 protect the downside, but only a break below 1.7921 will invalidate my bullish call and indicate that a new low is needed.
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