NZD/USD: A False Signal for a Move to the Downside?

Sometimes even the most reliable signals can turn out to be false. In this particular case, the signal in question is the hanging man candlestick that has formed on the weekly time-frame of NZD/USD below the resistance at 0.7070, which coincides with (MA)89 on the same time-frame. Usually such a candlestick is a signal for a drop, but in this case the signal appears to have been false, as the pair is still climbing and has broken above the aforementioned resistance, as well as above 0.7100. On the other hand we need to keep in mind that the pair still hasn’t broken above the previous high at 0.7146, so a reversal is still possible, but the higher NZD/USD climbs, the less likely said reversal becomes. If the pair succeeds in breaking above the previous high then it will likely continue climbing towards the next major level of resistance, which is at 0.7400 and coincides with (MA)89 on the monthly time-frame.