2026-01-12 03:07:00
The U.S. dollar may be hogging the spotlight this week with the U.S. CPI release, but in the words of a Poet of Petty, “Have you ever tried this one?”
I’m talking about currency crosses like GBP/NZD!
More specifically, a breakout that’s starting to brew and could boil over in the next couple of days.
The British pound is outperforming its fellow risk currencies as the U.K.’s relatively steady economic data keeps Sterling looking attractive. The country’s closer ties with the U.S. also make its economy less exposed to potential geopolitical pressure and *gestures at everything*.
Meanwhile, a lack of local economic data out of New Zealand leaves NZD more exposed to shifts in risk sentiment, which could sour as traders fret over China’s top-tier economic data releases, commodity prices, and broader global growth concerns.
Remember that directional biases and volatility conditions in market price are typically driven by fundamentals. If you haven’t yet done your homework on the British pound and the New Zealand dollar, then it’s time to check out the economic calendar and stay updated on daily fundamental news!
But GBP/NZD, which has been in an uptrend since mid-December, may be running into a ceiling near the 2.3400 psychological handle.
As you can see, GBP/NZD’s consolidation lines up with resistance from an ascending triangle that has held since it first showed up in mid-October.
Watch for red candlesticks and clear signs of a bearish bounce, which could invite selling pressure and pull GBP/NZD back toward the 2.3250 Pivot Point area, if not the 2.3200 triangle support line.
On the flip side, if pound bulls get their mojo back, GBP/NZD could punch through the 2.3400 major resistance area and make a run toward higher areas of interest like the 2.3500 or 2.3600 inflection points.
Whichever bias you end up trading, don’t forget to practice proper risk management and stay aware of top-tier catalysts that could influence overall market sentiment!
Disclaimer:
Please be aware that the technical analysis content provided herein is for informational and educational purposes only. It should not be construed as trading advice or a suggestion of any specific directional bias. Technical analysis is just one aspect of a comprehensive trading strategy. The technical setups discussed are intended to highlight potential areas of interest that other traders may be observing. Ultimately, all trading decisions, risk management strategies, and their resulting outcomes are the sole responsibility of each individual trader. Please trade responsibly.
