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Forex: NZD/USD Technical Analysis – Support Near 0.85 in Focus

Forex: NZD/USD Technical Analysis – Support Near 0.85 in Focus

2014-03-23 22:20:00
Ilya Spivak, Head Strategist, APAC
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Talking Points:

  • NZD/USD Technical Strategy: Flat
  • Support: 0.8500-13 (Oct 22 close, 23.6% Fib ret.), 0.8414 (38.2% Fib ret.)
  • Resistance: 0.8561 (trend line), 0.8630 (Apr 11 close)

The New Zealand Dollar may be topping against its US counterpart having edged past support at a rising trend line set from early February after forming a Bearish Engulfing candle pattern. Sellers are now testing the 0.8500-13 area, marked by the October 22 close and 23.6% Fibonacci retracement, with a break below that exposing the 38.2% Fib at 0.8414. Trend line support-turned-resistance is now at 0.8561.

Risk/reward considerations argue against entering short with prices so close to support. On the other hand, taking up the long side looks premature absent a defined reversal signal. We will continue to stand aside until a more actionable setup emerges.

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dailyclassics_nzd-usd_body_Picture_11.png, Forex: NZD/USD Technical Analysis – Support Near 0.85 in Focus

Daily Chart - Created Using FXCM Marketscope 2.0

--- Written by Ilya Spivak, Currency Strategist for DailyFX.com

DailyFX provides forex news and technical analysis on the trends that influence the global currency markets.

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