NZD/USD Technical Analysis: NZ Dollar Rebound Brewing Ahead?
To receive Ilya's analysis directly via email, please SIGN UP HERE
- NZD/USD Technical Strategy: Flat
- Positive RSI divergence hints Kiwi Dollar rebound may be in the cards ahead
- Actionable setup remains absent, arguing against taking on exposure for now
The New Zealand Dollar is digesting losses after finding support above the 0.68 figure against its US counterpart, with positive RSI divergence hinting a bounce may be ahead. Prices sank to the lowest level in five months after post-election coalition talks produced a Labour-led government.
From here, a break below the 0.6818-26 area (May 11 low, 76.4% Fibonacci expansion) confirmed on a daily closing basis exposes the 100% level at 0.6707. Alternatively, a move above the 61.8% Fib at 0.6899 sees the next upside barrier at 0.6959, the 50% expansion.
Confirmation of an upside reversal requires a more substantive signal than RSI divergence alone. Still, signs of ebbing downside momentum are probably reason enough not to attempt a short position for the time being. On balance, this suggests standing aside is mode prudent until a better-defined setup presents itself.
DailyFX provides forex news and technical analysis on the trends that influence the global currency markets.