NZD/USD Technical Analysis: Recovery Stalls at Trend Line
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- NZD/USD Technical Strategy: Flat
- Support: 0.7831, 0.7682, 0.7584
- Resistance:0.7864, 0.7937, 0.8034
The New Zealand Dollar moved higher against its US namesake as expected after prices put in a Bullish Engulfing candlestick pattern. A daily close above falling trend line resistance at 0.7864 exposes the 23.6% Fibonacci retracement at 0.7937. Alternatively, a reversal below the 14.6% level at 0.7831 opens the door for a test of the July 2013 bottom at 0.7682.
Risk/reward considerations argue against entering long with prices in close proximity to resistance. On the other hand, the absence of a defined bearish reversal signal suggests taking up the short side is premature. We will remain flat for now, waiting for a more actionable opportunity to present itself.
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Daily Chart - Created Using FXCM Marketscope 2.0
--- Written by Ilya Spivak, Currency Strategist for DailyFX.com