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NZD/USD Breaks Below 0.8600 As Dark Cloud Cover Weighs On Prices

NZD/USD Breaks Below 0.8600 As Dark Cloud Cover Weighs On Prices

David de Ferranti, Currency Analyst

Talking Points

  • NZD/USD Technical Strategy: Shorts Preferred
  • Dark Cloud Coveron the daily warning of continued declines
  • Push below 0.8600 to open up next support level at 0.8500

The Dark Cloud Cover formation noted in recent candlesticks reports has resulted in extended weakness for NZD/USD. This follows on from a failure to crack the critical 0.8740 mark last week. With a shift in the trend taking place, a daily close below key support at 0.8600 would cement a bearish technical bias.

NZD/USD: Dark Cloud Cover Suggests Continued Declines

NZDUSD-Breaks-Below-0.8600-As-Dark-Cloud-Cover-Weighs-On-Prices_body_Picture_2.png, NZD/USD Breaks Below 0.8600 As Dark Cloud Cover Weighs On Prices

Daily Chart - Created Using FXCM Marketscope 2.0

Drilling down to the four hour chart; a Shooting Star formation near the critical 0.8700 handle prompted the bears to resurface. A Doji candlestick is now on the radar, which signals the bears are hesitant to push further and may be the precursor to bounce.

NZD/USD: Doji Suggests Hesitation By The Bears

NZDUSD-Breaks-Below-0.8600-As-Dark-Cloud-Cover-Weighs-On-Prices_body_Picture_1.png, NZD/USD Breaks Below 0.8600 As Dark Cloud Cover Weighs On Prices

Four Hour Chart - Created Using FXCM Marketscope 2.0

By David de Ferranti, Market Analyst, FXCM

Follow David on Twitter: @Davidde

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