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NZD/USD Technical Analysis: Passing on Long Trade Setup
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Talking Points:
NZD/USD Technical Strategy: Flat
Support: 0.6814, 0.6713, 0.6623
Resistance:0.6950, 0.7033, 0.7169
The New Zealand Dollar put in a bullish Morning Star candlestick pattern, hinting a move higher against its US counterpart may be brewing ahead. Positive RSI divergence bolsters the case for an upside scenario. A daily close above the 14.6% Fibonacci retracement at 0.6950 exposes the 23.6% level at 0.7033. Alternatively, a reversal below the June 23 low at 0.6814 clears the way for a challenge of falling channel floor support at 0.6713.
Entering long looks rather tempting from a technical and risk/reward perspective. The fundamental backdrop is worrisome however, elevated RBNZ rate cut expectations and risk aversion courtesy of Greece-linked news-flow threatening to sting the Kiwi. With that in mind, we will begrudgingly opt to stand aside.
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--- Written by Ilya Spivak, Currency Strategist for DailyFX.com
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