EUR/NZD – Bullish Cup & Handle Setup
Price has formed a Cup & Handle pattern, with the neckline acting as the key resistance and confirmation level. My plan is to wait for a break and close above the neckline before considering the long entry.
At the neckline, bearish divergence is visible, which suggests that price may first make a short-term retracement. The expected retracement area is the Fibonacci 0.382–0.5 zone, where I am looking for price to find support and continue the overall bullish trend.
As price retraces into the 0.382–0.5 Fibonacci zone, I will be looking for regular bullish RSI divergence, where price forms a lower low while RSI forms a higher low. This would indicate weakening bearish momentum and provide additional confluence for bullish continuation.
Why I like the setup:
Cup & Handle structure supports the bullish bias.
Neckline break provides confirmation for the continuation.
0.382–0.5 Fib zone offers a potential pullback/support area.
RSI bullish divergence (possible) will support the possibility of buyers stepping back in.
Overall market structure remains bullish.
Trade Plan:
Direction: Long
Entry: Break & close above the neckline
Pullback Zone: 0.382–0.5 Fibonacci area
Confirmation: Bullish reaction + RSI divergence
Target: As marked on the chart
Invalidation: Break below the key support/Fibonacci structure.
The idea: Let the bearish divergence play out as a retracement, wait for price to react from the Fib zone, and then look for the neckline breakout to confirm the next bullish continuation.
#EURUSD #EURNZD #Forex #PriceAction #CupAndHandle #RSIDivergence #Fibonacci #TechnicalAnalysis #Sarmaaya.pk
source https://www.tradingview.com/chart/EURNZD/esMMZHFS-EUR-NZD-Bullish-Cup-Handle-Setup/
