NZD/USD: holding above 50% Fibo on fragile grounds

NZD/USD has been pretty robust considering the bearish sentiment surrounding global equities and heightened trade war rhetoric from the US on Monday.
NZD/USD is currently trading at 0.6525 and above the 21/10-4hr SMA bullish crossover.

Ross J Burland FXStreet

NZD/USD has held up despite heightened trade war risks and US stocks closing in the red yet again as risk turns over in mid-US session. NZD/USD traded between 0.6555 and 0.6521 sliding overnight and correcting Friday's bid from 0.6468. However, the bears have stalled at the 21-D SMA and confluence at the 50% Fibo of Oct's bull channel.

Wall Street erases early gains, closes in red following trade-war headlines

US stocks started off well but faltered around midday and then tumbled with the Dow staging the biggest intraday reversal in more than 8 months while the Nasdaq made its biggest U-turn in 3 years. A Bloomberg News report surfaced indicating that President Trump’s administration was prepared to impose tariffs on all China’s import if there is no progress made between at Nov's summit.

"USD was boosted by the recovery in global equities overnight, but NZD was also in favour, which saw this cross tread water. Global developments continue to dictate moves. Month-end portfolio rebalancing could add to kiwi selling in coming days," analysts at ANZ Bank New Zealand Limited explained.

NZD/USD levels

Support 0.6460
Resistance 0.6620

A break of 0.6505 with closes opens S3 located down at 0.6415 on clearing the 23.6% Fibo (20th Sep/7th Oct range) found at 0.6489. However, the price is holding above the 10-21-4hr SMA bullish cross which offers some support. On the flipside a break of the descending channel's resistance line and 0.66 the figure opens the room to 0.6634 as the 76.4% Fibo target, (20th Sep/7th Oct range).

Author

Ross J Burland

FXStreet

Ross J Burland, born in England, UK, is a sportsman at heart. He played Rugby and Judo for his county, Kent and the South East of England Rugby team.

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