- NZD/USD continues trading at around its long-term range highs.
- Despite recent weakness the trend is still probably bullish and therefore likely to extend.
NZD/USD reversed course after breaking out of the top of its consolidation range. It is threatening to fall back down towards the range lows, however, it is too early to say for sure.
Despite the current weakness, the trend remains bullish on the daily chart, and given “the trend is your friend” the odds still favor a recovery and eventual extension to higher highs. Price also remains above the trendline for the August rally, a further sign the uptrend is intact.
NZD/USD Daily Chart
The Kiwi is will probably achieve its next upside target at 0.6409, the December 2023 high. A break above 0.6302 would provide added bullish confirmation. Another target is situated at 0.6448, the 0.618 ratio of the height of the range extrapolated higher.
If NZD/USD closes below the trendline – currently at around 0.6160 – it could mark a reversal lower. A break below 0.6133 (September 3 low) would form a lower low and provide added confirmation. The next target to the downside would be at the cluster of Moving Averages situated at 0.6070, followed by the range lows in the 0.5850s.
The Moving Average Convergence Divergence (MACD) has not yet closed below its red signal line. If it does it will provide a sell signal although such a cross would not be enough alone to signal a change in trend.
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