NZDUSD Weekly, is this divergence?

[topchess]

Hello,

Correct me guys, Is this divergence or I am missing something?

That's one week chart for NZDUSD.

[PipDiddy]

That is bearish divergence. Price has been higher highs while the oscillator has not.

Take a look at the monthly chart as well.

While it's not complete, there could be a possible head and shoulders pattern forming. The pair is trading near its .618 Fib line but it looks to me it wants to go to .764 or 7100.

Not sure about going short though. It looks like the pair is taking a breather before resuming it upward march. It could chop down to 6800 though before bouncing but doesn't look like it'll be pretty.

[topchess]

Thank you for your helpful assistance.

You want to say that it is premature to short NZD at 0.6900 now? I am short from .6900 actually because It's not having successful attempt to gain the level. Doi you think it's premature to call for a top right now?

I watch your fib chart, and chances that it will attempt to go to .7100..but also is this bearish divergence going to last for long time before it drops?

Or, could it be that if we closed this month below the recent fib , chances will be for a reversal from here?

[PipDiddy]

Based on the US dollar weakness, it seems more probably that the pair has some more room to rise. What you could do is in scale in a short position. If you want to short now, open only 1/4 position, and if it rises to 7000 open another 1/4 position, and if it rises to 7100, which is a major resistance on the monthly chart, open the last 1/2 position short.

[topchess]

Very helpful, thanks.

I exactly do this strategy now, I will start with a quarter position, and add to it @ 7000 and 7100 respectively.

Thanks again.