GBPNZD could be in for a reversal from its climb as price formed a head and shoulders pattern on its 4-hour chart. Price is testing the neckline around the 1.9200 handle.

The 100 SMA already crossed below the 200 SMA to signal that the path of least resistance is to the downside or that support is more likely to break than to hold. Price is also trading below both moving averages as additional confirmation of selling pressure.

Stochastic is heading up to show that there is some bullish pressure in play, but the oscillator is nearing the overbought zone to signal exhaustion. Turning lower could bring sellers out and lead to a drop that’s around the same height as the chart formation, which is roughly 600 pips.

RSI appears to be edging higher and has room to climb before reflecting overbought conditions.

The upcoming BOE decision could bring in some volatility for this pound pair, as the central bank might shift to a more optimistic stance given how the vaccination rollout has seen a lot of progress.

Still, the BOE could keep rates on hold and asset purchases unchanged in a unanimous vote, likely holding out for more signs of growth now that the UK economy has recently reopened.

Meanwhile, the Kiwi could take its cues from the New Zealand quarterly jobs report. A slightly slower pace of hiring is expected for Q1 but an upside surprise might still bring gains for the higher-yielding currency. A downside surprise or a drop in hiring might weigh on RBNZ tightening hopes and drag the Kiwi south.

Risk appetite stemming from other central bank decisions (Australia, Brazil, Turkey) and jobs reports (from Canada and the US) would likely impact overall market sentiment as well.