NZD/USD Technical Analysis: Selloff Stalls at Key Trend Line

By DailyFx | Updated July 28, 2014 AAA

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Talking Points:

  • NZD/USD Technical Strategy: Flat
  • Support: 0.8535, 0.8443, 0.8350
  • Resistance:0.8650, 0.8721, 0.8779

The New Zealand Dollar dropped against the US Dollar after the RBNZ monetary policy announcement to test year-to-date uptrend support. Near-term support is at 0.8535, the intersection of a rising trend line set from January and the 38.2% Fibonacci retracement. Breaking below this barrier on a daily closing basis exposes the 50% level at 0.8443. Alternatively, a turn above the 23.6% Fib at 0.8650 clears the way for a challenge of the 14.6% retracement at 0.8721.

Risk/reward considerations argue against entering short with prices trading in close proximity to support. On the other hand, the absence of a defined bullish reversal signal suggests taking up the long side is premature. We will remain flat for now.

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NZD/USD Technical Analysis: Selloff Stalls at Key Trend Line

Daily Chart - Created Using FXCM Marketscope 2.0

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