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Talking Points:
- NZD/USD Technical Strategy: Flat
- Support: 0.8474 (23.6% Fib ret., trend line), 0.8393 (38.2% Fib ret.)
- Resistance: 0.8582 (100% Fib exp.), 0.8663 (123.6% Fib exp.)
New Zealand Dollar may be hinting at a forthcoming top against its US namesake as prices show a Shooting Star candlestick below resistance at 0.8582, the 100% Fibonacci expansion. Near-term support is at 0.8474, the intersection of the 23.6% Fib retracement and a rising trend line set from early February. A break below this boundary targets the 38.2% level at 0.8393. Alternatively, a reversal above resistance aims for the 123.6% expansion at 0.8663.
A Shooting Star candle is a sign of indecision and is not by itself an actionable selling signal. We will stand aside for now, looking for confirmation on a break below trend line support to look for a short trade opening.
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Daily Chart – Created Using FXCM Marketscope 2.0
— Written by Ilya Spivak, Currency Strategist for DailyFX.com