NZDCAD Triangle On Watch Price action in NZDCAD is worth monitoring here. Following the rally across February and into early March price has since been caught in a block of consolidation under the bear channel top. The consolidation has developed into a contracting triangle pattern, hemmed in by the channel top. In light of the previous rally, I’ll be watching for a breakout and continuation higher in coming sessions with .8751 the trigger level, targeting .8854 and .8975 thereafter.The pair is currently in a standoff given the pullback we are seeing in risk assets recently. However, CAD potentially has more to lose if the correction in oil prices deepens. Meanwhile, the recent hawkish shift in RBNZ sentiment still has further room to develop meaning that NZD might be better supported over the medium-term.Keep An Eye OnLittle on the data sheet this week bar CAD employment figure son Friday. However, the more important element to note is broader risk appetite. Both currencies remain under pressure on the back of recent Fed hawkishness. As this theme resolves, the greater focus will likely remain on oil prices which, if they remain subdued, should allow NZDCAD to rally. Current retail positioning is around 60% short, showing plenty of room for a breakout higher to develop near term.
Source: Tickmill
