NZD/USD Technical Analysis: Kiwi Eyes Double Top Resistance
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- NZD/USD Technical Strategy: Flat
- New Zealand Dollar breaks of congestion range, hits highest level in 2 months
- Waiting on the sidelines for actionable sell signal, passing of RBNZ event risk
The New Zealand Dollar soared to the highest level in two months against its US namesake, breaking out of a congestion range containing prices since early February. The completion of a Flag continuation pattern hints prices are en route to challenge and may break above double-top resistance
Near-term resistance is at 0.6830, the 61.8% Fibonacci expansion, with a break above that on a daily closing basis paving the way for a challenge of double top resistance in the 0.6883-97 area. Alternatively, a reversal below the 50% Fib at 0.6779 sees the next layer of support at 0.6729, the 38.2% expansion.
We expect the dominant NZD/USD down trend to resume, in line with our 2016 fundamental outlook. An actionable selling opportunity is absent however and the RBNZ rate decision represents potent event risk that may materially alter positioning. With that in mind, we will remain on the sidelines for now.
What do DailyFX analysts expect from NZD/USD in 2016? Check out ourforecast!