NZD/USD Technical Analysis: Consolidating Gains Above 0.88
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- NZD/USD Technical Strategy: Flat
- Support: 0.8805, 0.8766-79, 0.8737
- Resistance:0.8842, 0.8862, 0.8884
The New Zealand Dollar paused to consolidate gains after rising to the strongest level in three years against its US namesake. Resistance is now in the 0.8842-62 area, marked by a key swing high from August 2011 and the 38.2% Fibonacci expansion. This barrier is bolstered by the top of a rising channel at 0.8884. A daily close above the latter level exposes the 50% Fib at 0.8909. Alternatively, a reversal below the 23.6% Fib at 0.8805 aims for resistance-turned-support at 0.8779 – the May 6 high – followed by channel bottom at 0.8766.
Prices are wedged too closely between near-term support and resistance levels to justify taking a trade on the long or short side from a risk/reward perspective. We will remain on the sidelines for now, waiting for a more attractive opportunity to emerge.
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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.