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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 declined against its US namesake as expected after prices produced a bearish Three Inside Down candlestick pattern. A daily close below the 38.2% Fibonacci retracementat 0.7521 exposes the 50% level at 0.7452. Alternatively, a turn above the 23.6% Fib at 0.7606 clears the way for a challenge of falling trend line resistance at 0.7705.
Risk/reward considerations argue against entering short with prices in close proximity to support. On the other hand, the absence of a defined bullish reversal signal suggests taking up the long side is premature. We will remain flat for now, waiting for an actionable opportunity to present itself.
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Daily Chart - Created Using FXCM Marketscope
--- Written by Ilya Spivak, Currency Strategist for DailyFX.com
