NZD/USD Technical Strategy: FLAT
- New Zealand Dollar continues to tread water near 0.68 vs US cousin
- Overall trend marked by lower highs & lows, arguing for bearish bias
- Waiting for range, counter-trend support break for actionable short
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The New Zealand has struggled to break loose from a narrow range near 0.68 against its US namesake but overall positioning still argues for weakness. Indeed, the trend has been defined by a series of lower highs and lows since the formation of a triple top in mid-April.
Near-term support is in the 0.6688-0.6726 area, with a break below that confirmed on a daily closing basis exposing the 38.2% Fibonacci expansion at 0.6589. Alternatively, a turn back above support-turned-resistance at 0.6851 opens the door for a challenge of the 38.2% Fib retracement at 0.6959.
While chart positioning argues for a bearish bias, triggering a short trade seems premature. Counter-trend support set from July’s swing low remains conspicuously intact, warning that downside acceleration need not necessarily materialize in the near term. With that in mind, opting to wait seems prudentfor now.
NZD/USD TRADING RESOURCES:
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--- Written by Ilya Spivak, Currency Strategist for DailyFX.com
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