EUR/NZD Ichimoku analysis for August 30, 2011 2011-08-30
As expected, the EUR/NZD declined yesterday to the lower limit of the 4-hour Cloud represented by the Senkou Span B. This level was the main target of the correction developing on the market now. Further direction of the pair will be determined after a test of the Senkou Span B. In case the bears break it down it will denote the end of the major uptrend demonstrated by the upside Ichimoku Cloud. Otherwise the price is likely to rebound and recover to the upper limit of the Kumo. However, it is too early to predict this as the Tenkan-sen and the Kijun-sen (3, 4) are pretty much determined to continue the short-term downtrend.
In a 1-hour timeframe the bears are prevailing. Here the Ichimoku Cloud has a downside character and is diverging down – the Senkou Span A is directed to further decline. The Tenkan-sen and the Kijun-sen are still likely to fall down further and are keeping the Dead Cross (5) formed last Thursday. Therefore after a slight recovery to the Rotatopn line (3) the rate will probably continue to decrease. However we should not forget about the Chinkou Span that is likely to appear in the oversold zone soon. This might result in a consolidation above the 1.7000 level.