Forex: NZD/USD Technical Analysis – Support Above 0.85 in Focus

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Talking Points:

  • NZD/USD Technical Strategy: Flat
  • Support: 0.8513 (Oct 22 close), 0.8452 (38.2% Fib ret.)
  • Resistance: 0.8547 (23.6% Fib ret.), 0.8635 (trend line)

New Zealand Dollar declined against the US Dollar as expected having produced a Bearish Engulfing candlestick pattern below resistance at the April 2013 high (0.8675). A move through the 23.6% Fibonacci retracement at 0.8547 has exposed 0.8513, the October 22 close. Moving further below that eyes the 38.2% level at 0.8452. Alternatively, reversing back above 0.8547 aims for rising trend line support-turned-resistance at 0.8635.

Prices are too close to relevant support to justify entering short from a risk/reward perspective. On the other hand, the absence of a bullish reversal signal hints it is premature to take up the long side. We will continue to stand aside for now.

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dailyclassics_nzd-usd_body_Picture_11.png, Forex: NZD/USD Technical Analysis – Support Above 0.85 in Focus

Daily Chart - Created Using FXCM Marketscope 2.0

--- Written by Ilya Spivak, Currency Strategist for DailyFX.com


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