On Wednesday, the NZD/USD pair strengthened and broke out important resistance level at 0.6600. The pair is growing amid some recovery of the Asian stock markets and the USD weakness, which is still struggling to recover from poor labour market statistics that came out in the US last Friday. The data significantly lowered the chances of an interest rate hike in the US before the end of the year.
Some hints regarding further actions of the regulator markets expect to get from the FOMC Minutes, due later today.
Support and resistance
Bollinger Bands on the daily chart is turning up, while the price range is widening. However, for the sixth day in a row the price remains above its range that indicates likeliness of a downward correction. MACD continues growing and giving a buy signal. Stochastic is in the overbought zone and turning horizontally.
The indicators recommend short positions.
Support levels: 0.6560, 0.6534, 0.6500, 0.6457 (resistance level from 18 September), 0.6424, 0.6402, 0.6344, 0.6300, 0.6266, 0.6235 (23 September low).
Resistance levels: 0.6647 (7 October high), 0.6708 (21 August high), 0.6738 (29 July high), 0.6770 (10 July high).
Short positions can be opened after the breakdown of the level of 0.6545 with targets at 0.6485, 0.6440 and stop-loss at 0.6565. Validity – 1-2 days.
Long positions can be opened after the breakout of the level of 0.6630 with the target at 0.6750 and stop-loss at 0.6610. Validity – 2-3 days