Off session highs, trapped in a descending triangle

NZD/USD trades in the green on a week-to-date basis despite the pullback from session highs.
The pair has charted a descending triangle on the daily chart.

NZD/USD is currently trading largely unchanged on the day at 0.6478, having put in an eight-day high of 0.6493 early Thursday.

However, on a week-to-date basis, the pair is still up nearly 1%. These gains confirm or validate the positive view put forward by the inverted bullish hammer created last week. In addition, the 14-day relative strength index is reporting bullish conditions with an above-50 print.

As such, one may expect NZD/USD to breach the daily chart descending triangle on the higher side. That would imply a continuation of the rally from the May 15 low of 0.5921 and open the doors to January’s high of 0.6733.

At press time, the upper end of the descending triangle is located at 0.6495. A close above that level would confirm the bullish breakout. On the downside, the June 30 low of 0.6385 is the level to beat for the sellers.