On yesterday, EUR/NZD pair had an above moderate volatility of around 170+ pips. The volatility occurred towards bullish with the EURO domination. EURO noted a significant trend with all its pairs. But, the trend didn’t continue for the whole day and the trend reversal occurred during closing session.
The trend reversal had begun once the EUR/NZD pair crossed its resistance of 1.66739. Then, the trend was gradually moving towards bearish. During this downtrend, a price gap occurred. A price gap is defined as there is no overlapping between the successive trading periods.
The gap occurred in EUR/NZD pair is called run away gap. Usually gap indicates the crucial buying or selling and used as a powerful trend validating tool.
Even, from the opening of today’s market, the trend remains towards downtrend and moving near to the support 1.65289. Once the EUR/NZD support breaks, it is expected to move up.
The main criteria of this expectation are the believing in the runaway gap. So, it is expected to cross the pivot point of 1.66014. If the uptrend continues after crossing the pivot point, it is highly possible to reach its resistance again.