Morning Market Update – NZD/USD

NZD/USD is bouncing off support at 0.7140. The pair is heading towards resistance at 0.7197 and is expected to show another leg higher.

We favor a long term bullish bias. Support is now given at 0.7140 and is holding above the level. A gradual rise towards the major resistance at 0.7197 seems absolutely likely.

The pair posted some gains earlier today and tries to stay in the buyer’s territory. It has come down to retest the 0.71539 level and maintains a bullish bias as long as the price movement stays above this level. The price will increase further only if the pair stabilizes above the 0.7153 and retests the upper resistance of 0.71975.

On a strong breakout the market is looking for confirmation that the move will not simply and quickly be retraced. There has been a bit of a wobble on the pair but as yet it is holding. Recent strong candle breakout suggests the pair has gained some strong momentum and look to continue further higher.

However the retracement has bounced today from the previous breakout support band 0.7153, having posted a low at 0.7140. The longer the market holds on to this band of old resistance that has turned into new support, the more confident the bulls will be. Momentum is strong still with the Stochastic are rising. The next task is for the bulls to breakout above 0.7153 high and stay above it which has been able to hold until now and to continue the bull run. Otherwise there could be a degree of tiredness creeping in. The four-hourly chart shows an unwinding of near term momentum to levels where the bulls have tended to support. Subsequent upside resistance is 0.7197. The bulls will remain in control above 0.7153.

The NZD/USD pair fluctuates around the 0.7153 as its signs appear on the four hour chart, with a confirmation on breaching this level located at 0.7153. This could activate the positive effect of the mentioned pattern followed by rallying towards achieving positive targets that reach to 0.7197 followed by 0.7205on the short term basis.

Therefore, we will continue to suggest the bullish trend in the upcoming sessions, supported by the stochastic as mentioned, noting that breaking 0.197 will push the price to extend its bearish correction and head towards 0.7205 and might extend to 0.7215 before any new attempt to rise and retest the 50EMA.

Expected trading range for today is between 0.7153 support and 0.7215 resistance.

Expected trend for today: Bullish
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