Forex: NZD/USD Technical Analysis – Rally Finds Resistance Sub-0.83
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- NZD/USD Technical Strategy: Flat
- Support: 0.82265 (38.2% Fib ret.), 0.8235 (23.6% Fib exp.)
- Resistance: 0.8289 (50% Fib exp.), 0.8.14 (61.8% Fib exp.)
The New Zealand Dollar recoiled upward as we suspected, taking out a falling trend line defining the down trend from mid-January and hinting the near-term bias has shifted to favor the upside. Prices are now testing resistance at 0.8289, the 50% Fibonacci expansion, with a break above that targeting the 61.8% level at 0.8314. Alternatively, a reversal below support at 0.8265, the 38.2% Fib, targets the 23.6% expansion at 0.8235.
Entering long absent a defined break of resistance or assuming a downward reversal without confirmation and taking the short side seem equally unattractive from a risk/reward perspective. We will stand aside for now until something more compelling presents itself.
Daily Chart - Created Using FXCM Marketscope 2.0
--- Written by Ilya Spivak, Currency Strategist for DailyFX.com