On January 28, the depicted support at 0.6400 acted as a prominent key level offering a valid buy entry. The 0.6550 level was broken a few weeks ago.
Bullish persistence above 0.6550 (depicted recent support) was necessary to keep the price moving towards higher bullish targets.
During February's consolidations, the price zone of 0.6760-0.6840 constituted a significant resistance zone where signs of a bearish rejection were seen (triple-top reversal pattern).
On February 9, the NZD/USD pair failed to consolidate below the depicted support level at 0.6550.
Moreover, an obvious bullish recovery was expressed around the depicted temporary support level. Hence, the recent bullish swing towards 0.6760 and 0.6860 was initiated.
In March, obvious bullish breakouts above 0.6760 and 0.6860 were executed. Hence, the price level of 0.6750 constituted a significant support level where a bullish hammer daily candlestick was expressed on May 10.
Recently on May 6, a daily candlestick closure below the 0.6850 level enhanced a quick bearish movement towards 0.6760 where bullish rejection was expected to be applied.
That is why, bullish persistence above 0.6760 and 0.6850 is mandatory to maintain enough bullish momentum in the market.
On the other hand, bearish persistence below 0.6760 allows a quick bearish decline towards 0.6670.
The material has been provided by InstaForex Company - www.instaforex.com