NZDUSD Will Face Strong Resistance at 0.6800 Price Action
farhan fazal
NZDUSD·
Feb 22 2022
Stop Loss -1.73%
Holding time 11d22hr
0.67600
Entry price
0.68770
Stop loss price
Considering the NZDUSD price movement over the past few days, it may be a better option in the short term if the pair was bought at around 0.6624. Due to the volatile nature of the market, however, prices may change and lead to different outcomes.
Yesterday, we expected NZD to ‘consolidate and trade between 0.6670 and 0.6720’. However, NZD rose to 0.6735 before easing off to close little changed at 0.6701 (+0.08%). We expect NZD to trade sideways for today, likely between 0.6680 and 0.6725. Last Thursday (17 Feb, spot at 0.6690), we highlighted that risk has shifted to the upside and NZD could strengthen to 0.6735. NZD subsequently rose to 0.6730 before pulling back. Yesterday (21 Feb, spot at 0.6685), we highlighted while upward momentum has waned somewhat, there is still chance for AUD to push higher to 0.6735. NZD subsequently popped to a high of 0.6735 during early NY session before easing off. Despite the advance, upward momentum has not improved by much. 0.6735 is a solid resistance level and NZD has to close above this level before further advance is likely. On the downside, a breach of 0.6660 (‘strong support’ level was at 0.6645 yesterday) would indicate that the current upward pressure has eased.
NZD/USD recently failed to cross the 0.6730-35 resistance confluence, including the 50-DMA and a descending trend line from October 28. However, firmer RSI and bullish MACD signals keep the buyers hopeful until the quote drops below a three-week-old support line, near 0.6630.
Regarding the economic docket, New Zealand revealed that Credit Card Spending for January, rose to 5.5% y/y, which was higher than the previous month. On the US front, Markit PMIs for February featured, with Manufacturing and Services beating estimates, the former at 57.5, higher than the 56 foreseen, while the latter at 56.7 vs 53 expected.