These views are understandable. When caught in strong trends it could make one feel that this is likely to continue in to infinity. However, financial markets very rarely move that why.
From the chart perspective we are at a zone of very strong support which could prove to limit downside of the NZDUSD .
In fact taking into account that we appear to have an abc decline since July 2014 and with wave c forming what looks like very tight . In terms waves in the form of in these position are called , completion of which is a signal of either a full reversal or at least common retracement of the decline from July 2014.
Hence the "Title Could Kiwi Run or Fly".
If we are to expect lower prices, then these will be deferred till the retracement to 0.80 - 0.82 is completed again in abc formation to show that Kiwi can at least run.
Otherwise we might get 5 wave move to the upside suggesting it is possible for Kiwi to fly and retest the previous July high or even go on to make a new marginal higher high.
Which of these scenario will develop is difficult or near impossible to say right now. Nevertheless, the price development during its move to 0.8 - 0.82 will help clarify.
Most USD pairs are in fact in exact similar situation.
Suffice to say that the new cycle to the upside (even only as retracement) appears to be already in early stage and this is evident by many still looking to short any move to the upside and are likely to be disappointed.
1. At historical both horizontal and possible rising trend channel (as per monthly chart)
2. Just completed .
3. suggesting strong divergence in development at .
4. appears to have formed a cross with corresponding diverging away from it as it did in 2008-2009 low.
Any bears should not give too much room to any of their short positions as this is now a very high risk trade.
Traders should see what confirmation they require to consider possible long trade.
Observe the price as it moves to 0.80 -0.82 in order to get clues about future expectation namely with this be just a retracement or full reversal.
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