NZD/USD: deeper correction is possible

Current trend

The pair reached a local maximum of 0.7435 at the end of last month, after which it switched to the consolidation stage. Yesterday, despite positive comments from the US Federal Reserve, the regulator did not determine the exact timeframe for tightening monetary policy and raising rates, it was due to this that the dollar could not strengthen against the major currencies.

Today, special attention should be paid to US data, which may increase demand for the oversold US dollar, namely, data on unemployment, Non-Farm Payrolls and production orders. Consolidation can be replaced by a sharp drop after the breakdown of the lower border of the channel, if strong data on the labor market will provide a surge of investment interest in the US currency. An alternative scenario will be further growth and testing of new local highs against the background of weak statistics and sales of the US dollar.

Support and resistance

The uptrend may continue to the levels of 0.7700, 0.7800, if the pair, after reaching a maximum of 0.7435, consolidates above this level. Technical indicators on the four-hour chart do not give a clear signal: MACD indicates a decrease in the volume of long positions, the Bollinger bands lined up horizontally.

Support levels: 0.7335, 0.7310, 0.7295, 0.7275, 0.7250, 0.7200, 0.7180.

Resistance levels: 0.7370, 0.7400, 0.7420, 0.7435, 0.7450, 0.7480, 0.7530, 0.7700.

Trading tips

Short positions can be opened at the current levels and pending sell orders can be placed at the resistance levels of 0.7370, 0.7400 with a short stop loss at 0.7460 and targets at 0.7200, 0.7000.

New Zealand Dollar vs US Dollar

Buy Sell Spread
0.7327 0.73244 26

Scenario

Timeframe Weekly
Recommendations SELL
Entry Point 0.7356
Take Profit 0.7200, 0.7000
Stop Loss 0.7460
Support levels 0.7180, 0.7200, 0.7250, 0.7275, 0.7295, 0.7310, 0.7335, 0.7370, 0.7400, 0.7420, 0.7435, 0.7450, 0.7480, 0.7530, 0.7700

Alternative scenario

Recommendations SELL LIMIT
Entry Point 0.7370, 0.7400
Take Profit 0.7200, 0.7000
Stop Loss 0.7460
Support levels 0.7180, 0.7200, 0.7250, 0.7275, 0.7295, 0.7310, 0.7335, 0.7370, 0.7400, 0.7420, 0.7435, 0.7450, 0.7480, 0.7530, 0.7700

NZD/USD: deeper correction is possible

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