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Talking Points:
- NZD/USD Technical Strategy: Flat
- Support: 0.7521, 0.7452, 0.7384
- Resistance:0.7606, 0.7705, 0.7743
The New Zealand Dollar turned downward against its US counterpart as expected after forming a bearish Three Inside Down candlestick pattern. Near-term support is at 0.7521, the 38.2% Fibonacci retracement, with a break below that on a daily closing basis exposing the 50% level at 0.7452. Alternatively, a reversal above the 23.6% Fib at 0.7606 opens the door for a test of falling trend line resistance at 0.7705.
Prices are too close to support to justify entering short from a risk/reward perspective. On the other hand, the absence of a defined bullish reversal signal suggests that taking up the long side is premature. With that in mind, we will remain flat for now.
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Daily Chart - Created Using FXCM Marketscope
--- Written by Ilya Spivak, Currency Strategist for DailyFX.com
