NZD/USD Candlestick Analysis: Resistance Sub-0.76 in Focus
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- NZD/USD Strategy: Flat
- Candle Setup Hints Bottom Set Below 0.72
- Looking to Sell After Corrective Recovery
The New Zealand Dollar is pushing higher having completed a bullish Morning Star candlestick pattern and cleared resistance at 0.7418, the 14.6% Fibonacci retracement. From here, a break above the intersection of channel resistance-turned-support and the 23.6% level at 0.7567 aims for the 38.2% Fib at 0.7809. Alternatively, a move back below 0.7418 threatens to open the door for a descent back to January’s swing low at 0.7175.
On balance, the dominant medium-term trend has appeared to favor the downside since the pair invalidated the sequence of higher highs and lows established from May 2010. With that in mind, will treat on-coming gains as corrective and look to get short once the upswing runs its course and appears to show signs of reversing.
Weekly Chart - Created Using FXCM Marketscope
--- Written by Ilya Spivak, Currency Strategist for DailyFX.com