NZD/USD Technical Strategy: SHORT AT 0.7320
- NZ Dollar upswing rejected at six-week trend line resistance
- Overall trend bias defined by downward-sloping price channel
- Sellers taking aim at resistance below the 0.72 figure anew
The New Zealand Dollar recoiled from trend resistance capping forays to the upside for six weeks, hinting the next leg of the down move has begun. Overall positioning continues to be defined by a choppy channel formed by a series lower highs and lows, making for a broadly bearish bias.
Near-term support is at 0.7140, the 38.2% Fibonacci expansion. A daily close below that opens the door for a challenge of the 50% level at 0.7048. Alternatively, push up and through the trend line - now at 0.7292 - paves the way for a retest of 0.7355 (March 13 high, channel top).
Half of the short NZD/USD trade triggered at 0.7320 remains in play after partial profit was booked upon meeting the position's initial objective, looking to capture follow-on weakness. A stop-loss will be activated on a discretionary basis if the boundaries of the downtrend appear to have been breached.
NZD/USD TRADING RESOURCES
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--- Written by Ilya Spivak, Currency Strategist for DailyFX.com
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