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NZD/USD Technical Strategy: Flat
- New Zealand Dollar attempting rebound after finding support near 0.72
- Overall technical positioning continues to point to a bearish trend bias
- Actionable trade setup absent for now until a clear-cut trigger emerges
The New Zealand Dollar is attempting a cautious recovery against its US namesake but overall positioning continues to hint the path of least resistance favors the downside. The currency found interim support near the 0.72 figure but a series of lower highs and lows defining the near-term trend remains intact.
An immediate upside barrier comes in at 0.7332, the 23.6% Fibonacci expansion, with a break above that on a daily closing basis opening the door for a challenge of the 0.7428-34 area (38.2% level, September 20 high). Alternatively, a move below the 38.2% Fib retracement exposes the 50% threshold at 0.7109.
The short NZD/USD trade activated at 0.7227 was stopped out. From here, pursing the long side seems to run counter to the tone of the chart setup as a whole but re-entering short is premature absent an actionable trigger. Incoming US CPI data also marks potent event risk. Opting for the sidelines appears best for now.
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