NZDUSD broke above a key resistance level on Wednesday, closing above 0.6900 for the first time in five months. The pair also tested a key Fibonacci level at 0.6941– the 50% retracement level of the decline from 0.7743 to 0.6139 (April to August 2015 decline). After hitting a 9-month high of 0.6964 yesterday, the pair reversed back down and fell below the 50% Fibonacci.
Support lies at 0.6754, around where the 38.2% Fibonacci level exists. This is an important support level since it is where the 200-day moving average converges with the Fibonacci level. Meanwhile, if prices move back up and clear the 0.6900 level, there is scope to target 0.7000 and the next Fibonacci level at 0.7130. Failure to rise back above 0.6900 would keep the pair’s neutral bias which it has had since September 2015. NZDUSD has been in a range since the decline from, the April high of 0.7743.
MACD has been flat although above zero, indicating lack of momentum. RSI has not shown any clear trend either in the past month, although it has been trending higher in the past two days. The moving averages also have not shown any clear trend and are quite flat. The 50-day MA though has crossed above the 100-day MA so this could signal a bullish shift if it continues higher.
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