NZD/USD Is Forming A Barbed Wire Pattern On The W1 Time Frame

This is a rather tricky formation. According to its definition, it has at least three bars with long upper and lower shadows and overlapping bodies. That is exactly what we can see on the W1 time frame.

That formation means only one thing: a range, consolidation and the possibility for a breakout in either direction.

In this case the first target to the upside is 0.7500 followed by 0.7550.

In case there is a breakout below the strong support around 0.7150 the target to the downside would be the last local low around 0.6800 – 0.6780.

In my opinion both scenarios are almost equally probable, the drop to 0.6780 being slightly more so.