NZD/USD Technical ANALYSIS: BEARISH
- NZ Dollar breaches 2019 support shelf, challenging 2018 bottom
- Long-term positioning hints 19-year uptrend might be fracturing
- Neutralizing selling pressure probably needs a return above 0.68
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The New Zealand Dollar extended lower after breaking the bounds of the upswing from mid-June, pushing below the support shelf in the 0.6482-96 area to challenge the October 2018 low at 0.6425. A daily close underneath that exposes the January 2016 bottom at 0.6348 next.
Alternatively, a move back above 0.6496 – now recast as resistance – opens the door for another test of the 0.6559-91 congestion region. The overall trend bias looks decidedly bearish absent a breach of resistance guiding the broader downtrend since July 2017, now within a hair of the 0.68 figure.
NZD/USD daily chart created using TradingView
Zooming out to the monthly chart, a tectonic breakout looks to be in the offing. Prices are on the verge of breaking support defining an uptrend lasting nearly two decades (in fact, it has already given way on a weekly closing basis). If follow-through is found, a move toward the 0.60 figure may be next.
NZD/USD monthly chart created using TradingView
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--- Written by Ilya Spivak, Currency Strategist for DailyFX.com
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