There are a lot of events implicating the GBP, the latest being PM Boris Johnson contracting COVID-19 and being moved to the intensive care unit.
The news has kept GBP under pressure due to the uncertainty. As a result, GBPNZD has found some relief with a decent retrace in the past few trading sessions.
The daily chart above highlights a potential descending wedge in play (blue trendlines). The price initially made numerous attempts to attain a break higher of the channel top.
The consistent failure has prompted price to retrace lower. We can expect the drop to exceed further to test the bare minimum (dotted red lines.) A move below could accelerate the drop to the base of the potential descending wedge.
The 2-hour chart below consists of current price action. The pair has found modest temporary support at the current daily lows. However, if the bounces remain shallow, the probability of a break lower looms. The 2-hour chart also indicates that if we do break and close under, we are heading for a potential 2.0330 drop.
Alternatively, a break above to the April 6th high would encourage gains towards 2.1000 handle and would negate the descending wedge play.
