NZDUSD – Look for longs in the near term
consolidation

A larger corrective downtrend started from 0.8845 (Aug’11 high) appears to be unfolding in a multimonth triangle pattern. The corrective recovery from 0.7455 (June low) has the potential to test the swing high at 0.8475. A move above however signals alternate flat corrective wave targeting 0.8560/0.8845. A break below 0.7915 would renew the bear trend toward 0.7455 in a wave (E) before attempting medium term trend reversal. Nevertheless, a break of 0.7455/0.7370 would deepen the correction.

The uptrend renewal from 0.7915 could be a wave Y which could retest the swing high at 0.8475. The pair is now consolidating with upside focus on 0.8355. A break above targets 0.8400/0.8475 next. The pair looks to hold above 0.8205 now. A break below would test the 0.8135/0.8080 support where bulls would renew.

Anantharajan .P, CMT (Technical Strategist, Precise Trader)