NZD/USD Technical Analysis: NZ Dollar Rebound Gathering Steam?
NZD/USD Technical ANALYSIS: BEARISH
- New Zealand Dollar on the upswing from 11-year low
- Scope for upside follow-through still unclear for now
- Trader positioning offering mixed near-term signals
The New Zealand Dollar is attempting to reclaim some lost ground against its US counterpart after sliding to an 11-year low and finding interim support above the 0.56 figure. Immediate support-turned-resistance is at 0.5919, the 61.8% Fibonacci expansion.
A daily close above this barrier exposes the 50% level at 0.6078. Overturning the near-term bearish bias seems like it will require a grander feat however. That calls for breaking trend line resistance guiding the descent since the beginning of the year, which now implies a push toward the 0.63 mark.
The four-hour chart reveals NZD/USD has broken resistance guiding them lower for the past two weeks, seemingly setting the stage for upside follow-through. Immediate range resistance clustered near the 0.59 figure remains intact however, so what follows may yet be no more than sideways digestion.
NZD/USD 4-hour chart created using TradingView
NZD/USD TRADER SENTIMENT
Retail sentiment data shows 65.57% of traders are net-long, with the long-to-short ratio at 1.90 to 1. IG Client Sentiment(IGCS) is typically used as a contrarian indicator, soretail traders being net-long suggests NZD/USD may continue to fall.
However, the number of traders net-long is 5.66% lower from last week while the net-short exposure is up 9.38% over the same period. That makes for a mixed sentiment-based outlook, undercutting conviction in the bearish bias implied in overall positioning.
NZD/USD TRADING RESOURCES:
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--- Written by Ilya Spivak, Currency Strategist for DailyFX.com
To contact Ilya, use the Comments section below or @IlyaSpivak on Twitter
DailyFX provides forex news and technical analysis on the trends that influence the global currency markets.