Elliott Wave analysis of NZD/USD for August 6, 2021

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The Kiwi dollar only gave up strength for a merger 23.6% correction in wave 2 or B indicating underlying strength and the possibility of a run away rally in wave 3 or C. The decline to 0.6881 was followed by a clear loss of corrective momentum. A break above minor resistance at 0.7105 will confirm the completion of the corrective decline in wave 2 or B for a rally to at least 0.7558 and ideally a lot higher towards 0.8543.

The risk however, is that strong resistance at 0.7558 caps the upside and calls for a second corrective dip close to 0.6881 in a more complex wave 2 of B correction. However, under both scenarios it just will be a matter of time before an impulsive rally takes over for a rally towards 0.8543.

Time will tell and we have to be ready, when the next impulsive rally presents itself.

The material has been provided by InstaForex Company - www.instaforex.com

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