NZD/USD Technical Analysis: Channel Floor Under Pressure

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Talking Points:

• NZD/USD Technical Strategy: Flat
• Support: 0.6704, 0.6568, 0.6458
• Resistance:0.6787, 0.6923, 0.6970

The New Zealand Dollar remains under pressure against its US namesake, with prices aiming at channel support set from late April. A daily close below 0.6704 (23.6% Fibonacci expansion, channel floor) exposes the 38.2% level at 0.6568. Alternatively, a move above the 14.6% Fib at 0.6787 clears the way for a test of the June 25 high at 0.6923.

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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--- Written by Ilya Spivak, Currency Strategist for DailyFX.com