NZD/USD Technical Analysis: 5-Month Support Line Broken
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- NZD/USD Technical Strategy: Short at 0.7394
- Kiwi Dollar trend line breach hints at significant trend reversal
- Chart setup suggests a move to test below the 0.73 figure is ahead
The New Zealand Dollar broke below trend line support guiding the move higher against its US cousin since mid-May, hinting a significant reversal is in the works. The move lower may reflect pre-positioning ahead of the upcoming RBNZ monetary policy announcement.
The next layer of significant support comes in at 0.7276, the 38.2% Fibonacci retracement. A daily close below that opens the door for a challenge of the 50% level at 0.7188. Alternatively, a move back above the 23.6% Fib at 0.7384 paves the way for a retest of the 14.6% retracement at 0.7450.
Partial profit on the NZD/USD short position triggered at 0.7430 has been taken. Exposure will now be brought back to original size for a cumulative average entry price of 0.7394. The trade initially targets 0.7276 and carries a stop-loss activated on a daily close above 0.7450.
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