NZD/USD Technical Analysis: Trying to Clear Path Above 0.69
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- NZD/USD Technical Strategy: Flat
- Kiwi Dollar on the Offensive as Prices Yield Strongest 2-day Rally Since March
- Waiting for Signs of Reversal to Enter Short in Line with Long-Term Down Trend
The New Zealand Dollar resumed the ascent against its US counterpart, extending to the highest level in nearly four months. The Kiwi returned to the offensive after a single day of corrective losses following a 7-session winning streak, producing the sharpest 2-day rally in seven months.
Buyers now see the next upside barrier at 0.6871, the 50% Fibonacci expansion. A break above this barrier on a daily closing basis opens the door for a challenge of the 61.8% level at 0.6930. Alternatively, a turn back below the 38.2% Fib at 0.6811 – now recast as support – clears the way for a retest of the 23.6% expansion at 0.6738.
The available trading range is smaller than 20-day ATR, suggesting prices are wedged too closely between immediate support and resistance to justify entering a trade from a risk/reward perspective. On balance, the long term trend continues to look bearish. With that in mind, we will wait on the sidelines until an actionable bearish reversal signal emerges.
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