NZD/USD Technical Analysis: Multi-Year Downtrend Getting Started?
NZD/USD Technical ANALYSIS: BEARISH
- New Zealand Dollar breaks 2016 bottom, takes aim at 4-year lows
- Monthly chart warns nearly two decades of gains coming to an end
- Invaliding bearish bias likely needs breach of resistance form 2017
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The New Zealand Dollar has punched through support at 0.6348, the January 2016 low. Sellers now aim to challenge the bottom carved out between August and September 2015 in the 0.6197-0.6245 area. Pushing still further below that paves the way to challenge support clustered around the 0.60 figure.
Alternatively, a turn back above 0.6348 – now recast as resistance – would open the door to retest the underside of another former support level at 0.6425, marked by the October 2018 low. Invalidating the broader bearish trend bias would call for prices to move much higher however, challenging resistance from July 2017.
Longer-term positioning looks more ominous still. NZD/USD now looks all but certain to close out the month below support guiding it higher for nearly two decades, amounting to a structural shift in the bears’ favor. That may well set the stage for prolonged weakness for years to come.
NZD/USD monthly chart created using TradingView
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--- Written by Ilya Spivak, Currency Strategist for DailyFX.com
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DailyFX provides forex news and technical analysis on the trends that influence the global currency markets.