The New Zealand dollar has been on the back foot due to the trade wars. What’s next?
Here is their view, courtesy of eFXdata:
NAB discusses NZD/USD technical outlook and adopts a bearish bias in the near and medium-term. NAB now targets NZD/USD at 0.6435 in 1-.month, and at 0.6250 in 3-months.
“Last week’s close below the previous 2019 range of 0.6575/80 to 0.6939/42 confirms that NZD/USD has returned to its multi-year downtrend. Since late 2016 NZD/USD has trended lower in a perfect parallel downtrend channel. The base of the channel is currently at 0.6250/70 and provides an excellent MT target.
The confirmed break of the previous 2019 range / rectangle has a textbook target at 0.6200/50 and coincides with the base of the channel in time,” NAB notes.
“ST, MT and LT momentum confirm a comprehensive negative MT momentum bias and maintain immense downward pressure in the coming weeks to months,” NAB adds.
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