NZDUSD – Short term recovery could extend if
0.8075 is breached
A larger corrective downtrend started from 0.8845 (Aug’11
high) appears to be still in force which allows for a retest of the 0.7455/0.7370
support on multimonth basis. However, the corrective recovery from 0.7455 (June
low) has the potential to test the 0.8240/0.8320 resistance. The swing high at
0.8475 is likely to cap the strength in the medium term (A multimonth triangle
pattern?). A reversal below 0.7750/0.7670 would renew the bear trend toward
0.7455 initially.
The pair is refocused on 0.8075 now after a near term
setback. If the swing high caps, the near term consolidation would continue. A
break above 0.8075 extends the recovery toward 0.8240/0.8320. We expect the
0.7860/0.7840 support to hold now on weakness ahead of 0.7750. A break below
however favours bears.
Anantharajan .P, CMT (Technical Strategist, Precise Trader)
