NZD/USD Technical Analysis: Waiting to Confirm Reversal
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- NZD/USD Technical Strategy: Flat
- Support: 0.7660, 0.7602, 0.7469
- Resistance:0.7854, 0.8051, 0.8138
The New Zealand Dollar may be preparing to move higher against its US namesake after putting in a Bullish Engulfing candlestick pattern. A daily close above channel top resistance at 0.7854 exposes the 0.8034-51 area marked by the October 21 high and the February 2014 bottom. Alternatively, a reversal below the 0.7660-82 area (channel floor, July 2013 low) opens the door for a test of the 38.2% Fibonacci expansion at 0.7602.
Entering long appears premature for now absent confirmation of recovery on a daily close above the channel top. On the other hand, the absence of a defined bearish signal and prices’ proximity to support argues against taking up the short side. We will remain on the sidelines for now.
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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.