NZD/USD: 0.8500 is so near and yet so far

By FXstreet.com | Updated August 15, 2014 AAA

FXStreet (Moscow) - NZD/USD has recovered from the Asian low of 0.8468 and stalled at 0.8485 as bulls are not ready for another assault at 0.8500 resistance.

Kiwi learns to fly anew

NZD/USD got the second bullish candle on daily charts in a row, which means that the pair might have bottomed out at 0.8408 (this is the low of August 12). If this is the case, kiwi could possibly extend its upside towards the end of the week, though we need a sustained break above 0.8500/10 resistance area for more bullish-friendly environment. Kiwi is definitely oversold after a steep decline from the top of 0.8837 reached on July 10. The pair lost more than 400 pips in a month, so its high time to take profit on some short positions. On the other hand, positive US economic data is a key risk factor for this view as good industrial production numbers and optimistic consumer sentiment indicator of University of Michgan might push the USD higher across the board and put NZD/USD under renewed pressure.

What price levels and patterns have to be considered?

Spot is presently trading at 0.8486, and next resistance can be seen at 0.8488 (Daily Classic PP), 0.8493 (Daily Open), 0.8493 (Weekly High), 0.8495 (Daily High) and 0.8515 (Yesterday's High).

Support below can be found at 0.8484 (Hourly 20 EMA), 0.8473 (Weekly Classic PP), 0.8467 (Daily Low), 0.8465 (Hourly 200 SMA) and 0.8462 (Daily 200 SMA).

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