NZD/USD Looks Set For More Gains
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NZD/USD Looks Set For More Gains

The New Zealand dollar surged higher against the US dollar yesterday, as the latter one dived after several disappointing economic releases. The NZDUSD pair surged higher to trade as high as 0.7995 during the NY session yesterday. However, the pair failed to overtake the 0.8000 handle and corrected lower. Nevertheless, the bullish bias is not over as of yet, and there is a chance of one more push higher in the coming sessions. The US dollar needs a reason for a correction, and events lined up during the NY session might help the greenback to recover ground. On the other hand, if the economic data disappoints, then it might continue trading lower.

See chart attached as post image

There was a critical resistance trend line on the hourly chart of the NZDUSD pair, which was breached yesterday after the US economic releases. Later, the pair corrected lower and retested the broken resistance area. Currently, the pair is trading around the 23.6% fib retracement level of the last leg from the 0.7805 low to 0.7995 high. The most important point is that sellers are finding it hard to pierce the broken trend line again. This means there is a chance of a short-term spike towards the recent high of 0.7995. It would be interesting to see how it reacts around the mentioned area again moving ahead.

On the downside, the 38.2% fib level can be seen as the next major support area, followed by the 50% fib level. The hourly RSI is heading towards the 50 level, which might act as a support for the pair.

Overall, one might consider buying dips as long as the pair stays above the 100 hourly moving average.

Posted By Simon Ji