NZD/USD analysis | Nov 07, 2019

Although I had entered a little early in NZD/USD (it retraced down a little more), I am still bullish in NZD as I was in previous analysis.

The last swing down on daily/D1 time-frame looks just like previous two downward retracements, it doesn't seem to be a reversal. These three harmonic retracements make a setup for further continuation.

A look alike 3-drive pattern was formed, 2nd drive was 161.8 of 1st retracement and 3rd drive was 1272.2 of 2nd retracement (these expansions have not been plotted on chart); thus it is mathematically fulfills the criteria to be a 3-drive.

3-drive is a reversal pattern which actually shows/is formed by the exhaustion of market speed, exhausted market makes slower 2nd and slowest 3rd drive and then collapse to cause a reversal. But, this 3-drive is not showing exhaustion of market because 2nd drive is way faster than 1st and even 3rd is faster than 1st drive. Although, market has respected this look alike pattern and cause the 3rd retracement, this 3-drive doesn't seem to be perfect and can't seem to cause full reversal. Hence, this pattern doesn't contradict with the idea of further upward continuation.

ABCD161.8 (0.64831) and a'b'c'd'100.0(0.64776) almost coincide. We can set TP in mid of them.

Risk: Setup fails if any D1/daily candle closes below c/a'. Note that minimum target of 3-drive is to erase the last/3rd drive. It means that if NZD/USD closes below c/a', the 3-drive will be said to have completed minimum target; then it will be considered significant despite it's not perfect, so then it may cause even further fall.