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NZDUSD at channel high but near support

Market Analysis
Chart_16-06-10_11-03-29

NZDUSD, Daily

NZDUSD rallied strongly after the RBNZ didn’t cut the rates after the governor Wheeler had been suggesting there might be a need for further easing. He said, “Further policy easing may be required to ensure that future average inflation settles near the middle of the target range. We will continue to watch closely the emerging flow of economic data.” This took the pair beyond the 0.7054 resistance which is now likely to act as a support.

In in the daily picture NZDUSD is trading outside the upper Bollinger Bands and near a channel high which has already meant that the buyers find it difficult to take the pair higher. It has resulted in a shooting star candle in the daily timeframe and a potential roll over of the Stochastics oscillator. These are bearish signs and could lead to price drifting lower towards the 0.7054 support. However, the 0.7054 support is relatively near and is likely to put off the shorts at the current levels. This should lead the market to rally attempts from the supports.  The intraday support and resistance levels are at 0.7080 – 0.7090 and 0.7140 – 0.7150 while daily support and resistance levels are at 0.7054 and 0.7148.

I posted earlier today a brief intraday analysis in Facebook with long targets at 0.7110 and 0.7150. Price has since rallied almost to my T1 but retraced then back into the support with the upside momentum fading. Just at the time of writing there’s been some buying coming in (current price at 0.7096) with price creating higher lows in small time frame charts. If the support holds and NZDUSD moves to my T2 at 0.7050 the probabilities of market breaking higher will increase.

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Janne Muta

Chief Market Analyst

HotForex

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