According to the technical analyst team at ICN.com, “The NZD/USD declined yesterday reaching the first target, yet failed to breach the level around 0.8183, which is a critical barrier over intraday basis. Breaching this level will form the Double Top pattern and might extend the downside move.”
The cross has notched an advance of +0.09% on the day, and faces additional resistances at 0.8255, 0.8310, and 0.8355, according to ICN.com analysts. Should the consolidation movement continue unabated, supports will be initiated at 0.8190, 0.8160, and 0.8135.
The NZD/USD is currently testing the first of two important support levels, being 0.8180 and 0.8130. “Should these give way, we would be compelled to switch to a bearish stance, despite domestic fundamentals being supportive for the NZD over the medium-term. The NZD is being dragged lower by the AUD, which has the weight of RBA dovishness and softening fundamentals to contend with.” writes Sean Callow, a Global Markets Strategist at Westpac.