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Talking Points:
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NZD/USD Technical Strategy:Flat
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Support: 0.7340, 0.7275, 0.7171
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Resistance:0.7448, 0.7532, 0.7616
The New Zealand Dollar may be readying to turn lower anew against its US namesake after putting in a Bearish Engulfing candlestick pattern. Near-term support is at 0.7340, the 14.6% Fibonacci expansion, with a break below that on a daily closing basis exposing the 23.6% level at 0.7275. Alternatively, a turn above the 38.2% Fib retracement at 0.7448 opens the door for a challenge of the 0.7508-32 area marked by channel support-turned-resistance and the 50% threshold.
Prices are too close to support to justify entering short from a risk/reward perspective. On the other hand, the absence of a defined bullish reversal signal suggests that taking up the long side is premature. With that in mind, we will remain flat for now.
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Daily Chart - Created Using FXCM Marketscope
--- Written by Ilya Spivak, Currency Strategist for DailyFX.com
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