Starting from November 2, the NZD/USD has been steadily rising from 0.6588 and tested the high at 0.7168 on December 17. It would be reasonable to assume that the correction is likely to occur in the nearest future, after such consistent growth. The current price action supports this scenario to some extent because recently, there was a break below the ascending channel as well as the average-price uptrend trendline. On the breakout, the price failed to test either 200 Simple or 200 Exponential Moving Average, which might be the case this or next week.
It can be clearly seen that near 0.7000 psychological level, strong support has been formed. Simultaneously, on the pullback, the price has rejected the 78.6% Fibs resistance at 0.7134, implying the beginning of either a correction or a consolidation phase. For the time being, NZD/USD could be stuck between the 0.7000 support and 0.7134 resistance area. The higher price gets, the better the risk/reward opportunity will be presented for sellers. Obviously, selling opportunity will remain valid only if the price will manage to stay below 0.7168.
As long as this will be the case, NZD/USD can be expected to move down. At the very least, price can decline towards the 23.6% Fibs at 0.7032, which corresponds to 200 SMA and EMA. But then, if it manages to break below 0.7000, further downside correction will become highly probable. In this case, the price can drop further, towards one of the Fibonacci levels, either at 0.6948,0.6878 or 0.6810 support level.
Nonetheless, as long as the price is above 0.7000, the trend remains bullish. A break above 0.7168 will invalidate the short term bearish scenario and NZD/USD will most likely continue moving higher.
Key support levels: 0.7032, 0.7000,
Key resistance levels: 0.7134, 0.7168
Thanks for your support! If you liked this analysis, please support our profile with a 👍 and follow us to get a new daily analysis.
Disclaimer: The analysis presented in this article is for educational purposes only and should not be considered as financial advice
It can be clearly seen that near 0.7000 psychological level, strong support has been formed. Simultaneously, on the pullback, the price has rejected the 78.6% Fibs resistance at 0.7134, implying the beginning of either a correction or a consolidation phase. For the time being, NZD/USD could be stuck between the 0.7000 support and 0.7134 resistance area. The higher price gets, the better the risk/reward opportunity will be presented for sellers. Obviously, selling opportunity will remain valid only if the price will manage to stay below 0.7168.
As long as this will be the case, NZD/USD can be expected to move down. At the very least, price can decline towards the 23.6% Fibs at 0.7032, which corresponds to 200 SMA and EMA. But then, if it manages to break below 0.7000, further downside correction will become highly probable. In this case, the price can drop further, towards one of the Fibonacci levels, either at 0.6948,0.6878 or 0.6810 support level.
Nonetheless, as long as the price is above 0.7000, the trend remains bullish. A break above 0.7168 will invalidate the short term bearish scenario and NZD/USD will most likely continue moving higher.
Key support levels: 0.7032, 0.7000,
Key resistance levels: 0.7134, 0.7168
Thanks for your support! If you liked this analysis, please support our profile with a 👍 and follow us to get a new daily analysis.
Disclaimer: The analysis presented in this article is for educational purposes only and should not be considered as financial advice