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- NZD/USD Technical Strategy: Short at 0.6895
- Kiwi Dollar scores biggest one-day gain in 5 months but downtrend remains
- Short position looks for an initial decline to test support near November low
The New Zealand Dollar scored the largest daily gain in five months against its US counterpart but the dominant trend bias continues to favor weakness. The currency soared after Adrian Orr was named as the next RBNZ governor but the near-term series of lower highs and lows remains intact.
Critical support remains at 0.6781, November 17 low. A daily close below that targets a channel bottom now at 0.6736, followed by the 38.2% Fibonacci expansion at 0.6697. Alternatively, a move back above the 23.6% Fib retracement at 0.6935 exposes the 0.7030 (38.2% retracement, former trend line support).
The entry order to sell NZD/USD at 0.6895 established last week has been triggered. The position initially targets 0.6793, with a stop-loss to be activated on a daily close above 0.6946. Profit on half of open exposure will be booked and stop moved to breakeven when (and if) the first objective is met.
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