Of the main assets we monitor, the NZDCHF is the longest trending currency pair and the Oil pairs the longest trending commodity. A lot of column inches and many analysts spout the Oil trend but other, less popular assets can trend equally as well. The NZDCHF is a great example. Both the Oil markets (USOil and UKOil) and NZDCHF look to be closing the week and month above their respective 20-day moving averages for the 37th consecutive day. Trends can indeed run and run, and as a trader, Moving Averages, with all their “lagging and too simple” drawbacks still keep you on the right side of extended market runs.
Prior to this run the NZDCHF was in a 40 day-plus move to the downside, initially suggested on July 26 before confirming the break lower on August 2. The break back over the 20-day moving average did not confirm until September 25. The late September rally stalled at the 50-day moving average, the break lower was not confirmed and the engulfing candle of October 11 confirmed the potential move higher which is still running.
Technically, the pair remains positive, with initial Resistance at the recent high (November 16) at 0.6880, the upper Bollinger band, S3 and psychological 0.6900 and the 200-weekly moving average 0.6920. The daily pivot point at 0.6820 is first support zone followed by S1 and the 20-day moving average at 0.6795 and the 200-day moving average at 0.6709.
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Head Market Analyst
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