NZD/USD Technical Analysis: Trend Still Points Down After Rebound
NZD/USD Technical ANALYSIS: BEARISH
- New Zealand Dollar launched a rebound after hitting four-year lows
- Spirited gains nevertheless look corrective within broader down move
- Monthly chart points to long term, structural bearish trend reversal
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The New Zealand Dollar has launched a spirited recovery after finding a bottom just above support marking the August to September 2015 bottom. Prices are on pace to score the fourth consecutive day of gains, marking the longest winning streak in two months.
Support-turned-resistance at 0.6425 (October 2018 low) marks the first upside hurdle. A daily close above that targets another former support level in the 0.6482-96 area. Neutralizing the broader downtrend calls for a greater feat however: a push above downward-sloping resistance from July 2017 (now at 0.6766).
That suggests the recent rise is well within the bounds of a correction, whereas the dominant bias remains bearish. The monthly chart reinforces this view. It reveals that August ended with a break of support guiding NZD/USD higher for nearly two decades, flagging a structural, long-term trend change underway.
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.