Cup and Handle Breakout Puts NZD/CAD in Buy Mode
Date: 13 August 2025
Overview
The analysis focuses on the NZD/CAD currency pair, which has recently experienced a significant upward movement. This rise is attributed to a technical pattern known as the "cup and handle," which is a bullish formation often seen in trading charts.
Cup and Handle Pattern
The cup and handle pattern is visually represented on the chart, with the cup forming a rounded bottom and the handle representing a slight pullback before the breakout. The pattern is highlighted in yellow on the chart, indicating its importance in the current analysis.
Initially, the price action respected a green horizontal support level, which served as a solid foundation for the recent rally. The breakout above the red neckline of the cup and handle pattern is a strong bullish signal, suggesting that the pair is poised for further gains.
Current Market Conditions
As of now, the price is approaching a critical technical barrier, represented by a black downtrend line. The analysis indicates that a daily close above this downtrend line would provide a powerful confirmation of the bullish sentiment generated by the cup and handle breakout.
Should this confirmation occur, the technical target for NZD/CAD is significantly higher, indicating the potential for an extended bullish phase in the market.
Conclusion
The sentiment surrounding NZD/CAD remains positive, but the breakout above the black downtrend line is crucial for momentum traders. This level will determine whether traders can capitalize on the bullish move initiated by the cup and handle pattern.