New Zealand Dollar May Soon set Tradable Top
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Trade Implications – NZDUSD: Retail traders recently hit their most short NZDUSD on record. We typically go against the crowd; if everyone’s short we prefer to be long. Yet extremely one-sided positions often warn of the top.
Short interest is now nearly half of what it was at its recent peak, and early signs of crowd capitulation at these levels warn that the turn is near. Our Senior Technical Strategist writes that the NZD will need to move below resistance-turned-support at $0.8450 to suggest a “tradable top” is in place.
--- Written by David Rodriguez, Quantitative Strategist for DailyFX.com
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DailyFX provides forex news and technical analysis on the trends that influence the global currency markets.