A daily closure below 0.6750 allowed a quick bearish decline to occur towards the level of 0.6500 that was broken to the downside as well.
However, the levels of 0.6400-0.6350 constituted a significant support zone. Hence, a strong bullish rejection was expressed on January 20 (inverted head and shoulders pattern).
Since January 26, bullish persistence above 0.6500 was mandatory to keep pushing the NZD/USD pair towards higher bullish targets.
However, a temporary bearish rejection has been expressed around 0.6550 for almost two weeks resulting in a depicted consolidation range.
On January 28, the depicted support level of 0.6400 acted as the prominent key level offering a valid buy entry. A bullish breakout above 0.6550 has been executed earlier last week.
Bullish persistence above 0.6550 (depicted recent support) was needed to keep the price moving towards higher bullish targets.
The area of 0.6700-0.6750 constituted a significant resistance zone. Recent signs of a bearish rejection were seen during last week's consolidations near the same zone.
On February 9, the NZD/USD pair failed to consolidate below 0.6570 (depicted support level). Hence, a bullish pullback took place towards 0.6700 where a recent bearish movement was initiated.
Obvious bullish recovery was expressed at 0.6570 (a temporary support level) On Wednesday.
On the other hand, the level of 0.6700 will remain a significant resistance level to offer a valid sell entry.
Note that persistence below 0.6570 is mandatory to allow further bearish decline towards the zone of 0.6550 - 0.6500 where the price reaction should be watched for a possible buy entry.
The material has been provided by InstaForex Company - www.instaforex.com