NZD/USD: Near-term Range Braces for RBNZ; Key Resistance 7450

2016-09-21 19:46:00 Michael Boutros

Talking Points

NZDUSD at risk ahead of RBNZ
Updated targets & invalidation levels

NZDUSD 120min

Chart Created Using TradingView

Technical Outlook: Heading into the RBNZ interest rate decision shortly after the New York close, Kiwi continues to hold below former trendline support, now resistance. On whole the pair has setup a well-defined weekly opening-range and we’ll be looking for a break heading into the release.

Kiwi is now testing resistance on the back today’s FOMC policy meeting with a breach here targeting 7390 & key resistance at the 2016 high-day close at 7449. Interim support rests at 7292/96 backed by the weekly & monthly opens at 7248/56- a break below this region would be needed to shift the focus lower targeting 7218 & the 61.8% retracement at 7155. From a trading standpoint, I would be looking for near-term strength to offer favorable short entries while below the high-day close. For the complete setup and to continue tracking this trade & more throughout the week- Subscribe to SB Trade Desk.

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A summary of the DailyFX Speculative Sentiment Index (SSI) shows traders are net shortNZDUSD- the ratio stands at -1.39 (42% of traders are long)- bullish reading
Long positions are 7.5% above levels seen last week while short positions are 17.3note% higher over the same time period.
Open interest is 6.7% lower than yesterday and 13.1% below its monthly average.
Note that SSI has continued to come off extremes since the high registered earlier this month and although retail traders remains net short, the risk remains for a move lower while below key resistance.

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