NZD/USD Technical Analysis: Trend-Defining Resistance in Focus
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- NZD/USD Technical Strategy: Flat
- Kiwi Dollar aims at trend-defining resistance after bounce from 5-month low
- Performance at this barrier likely to define near to medium directional bias
The New Zealand Dollar turned higher as expected after falling to a five-month low against its US namesake, with prices now facing trend-defining chart resistance. The way prices behave at this pivotal juncture is likely to define the dominant trend bias for the near to medium term.
A daily close above the 0.70 figure would invalidate last month’s break of two-year rising trend support and violate the series of descending highs and lows started in late July, setting a firmly bullish tone and exposing the 38.2% Fib retracement at 0.7101. Alternatively, a close below counter-trend support (now at 0.6916) opens the door for a challenge of the 14.6% Fib expansion at 0.6872.
Positioning is inconclusive for now. The near-term bias favors weakness but a clear break of the upswing form October lows is needed for an actionable short trade setup. Entering long before resolution at key resistance is likewise premature. With that in mind, standing aside seems most attractive.