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11 Nov 2014
NZD/USD: Bearish setback poses renewed downside risks
FXStreet (Bali) - On the back of a failed breakout of 0.7670/0.77 last Friday, which ended with the NZD/USD printing a sizeable bullish outside day, Monday saw the initial upward impetus come to a standstill above $0.78 cents after leveraged funds/CTAs reset USD longs along the NA session, producing a daily shooting star that poses now downside risks again.
Technically, Jim Langlands, Founder at FXCharts, notes: "The topside could see a squeeze back towards the 200 HMA at 0.7770 and then on to 0.7800 (38.2% of 0.8035/0.7660). Beyond here would prove tricky in the short term but the major trend resistance is not to be seen until 0.7860. Downside, a break of the session lows at 0.7740 would see a run towards 0.7700, which should be quite strong support (50% of 0.6560/0.8838) but below which would see a retest of 0.7660. Under this, there are minor support at 0.7625 and at 0.7600, but not an awful lot to prop it up ahead of 0.7530 (100 Month MA)..."
Technically, Jim Langlands, Founder at FXCharts, notes: "The topside could see a squeeze back towards the 200 HMA at 0.7770 and then on to 0.7800 (38.2% of 0.8035/0.7660). Beyond here would prove tricky in the short term but the major trend resistance is not to be seen until 0.7860. Downside, a break of the session lows at 0.7740 would see a run towards 0.7700, which should be quite strong support (50% of 0.6560/0.8838) but below which would see a retest of 0.7660. Under this, there are minor support at 0.7625 and at 0.7600, but not an awful lot to prop it up ahead of 0.7530 (100 Month MA)..."