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Dollar Woes prevail NZDUSD breachs 07300

Market Analysis

NZDUSD, H4                    

The greenbacks woes continued its path lower , leaving EURUSD at 33-month highs of 1.2092, and USDJPY at 10-month lows of 107.36. Risk-off remains in place, driven by N. Korea, U.S. politics, and another hurricane about to hit the U.S. Southeast. The U.S. calendar is light to end the week, but features July wholesale figures, where inventories are expected at up 0.4% from 0.6% previously, and sales are seen up 0.5% from 0.7% in June.

NZDUSD presented a long opportunity on the H4 and Daily time frames, as the pair rallied to north of 0.7300 earlier. Entry was taken on the retrace to 0.7295 which was also the 38.2 Fibonacci retracement level of the August move lower. The H4 has positive Parabolic SAR, RSI 65 and rising and a very strong 04:00 hrs candle. Target is the 14 period ATR at 0.7324, a break of the recent low at 0.7195 would negate this move.  The higher time frame Daily chart also triggered an entry at 0.7295 following the strong breach and break of the 20 day moving average. Target 1 is a little over the 50 Fibonacci level, the 14 period ATR and the top of the Bollinger band at 0.7360. Target 2 is a round a previous resistance level and the 61.8 Fibonacci level at 0.7446. A strong reversal through the recent lows at 0.7150 would negate this move higher.



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Stuart Cowell

Senior Market Analyst


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