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Talking Points:
- NZD/USD Technical Strategy: Flat
- Support: 0.8131, 0.8064, 0.7997
- Resistance:0.8248, 0.8290, 0.8395
The New Zealand Dollar bounced as expected against its US counterpart, with a bullish Morning Star candlestick pattern hinting at more of the same ahead. Near-term resistance is in the 0.8226-48 area, marked by the 14.6% Fibonacci retracement and a falling trend line set from early July. A break above that on a daily closing basis exposes the 23.6% level at 0.8290. Alternatively, a turn below the 38.2% Fib expansion at 0.8131 opens the door for a test of the 50% threshold at 0.8064.
While a Morning Star formation argues for a move higher, the down trend established from early July remains intact absent a close above trend line resistance, hinting that entering a long position is premature. With that in mind, we will remain flat for now pending further confirmation.
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Daily Chart - Created Using FXCM Marketscope 2.0
--- Written by Ilya Spivak, Currency Strategist for DailyFX.com
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