NZDUSD moves toward key 100 day MA and Fibo Retracement level.

In an earlier post, I warned of a move below the 100 bar MA and the 50% retracement. The price looked to hold against these key intraday levels (see chart above), but succumbed to the downside. The price is now down testing the 100 day MA and the 38.2% retracement of the move up from the March 2011 low. Those levels come in at the 0.8182 and 0.8156 levels respectively. The low has reached 0.8170 level – at the lows for the day and week.  Not a good ending for the risk currency pair. 

The NY Opening Forex Commentary for June 7th

NY Evening Forex Commentary for June 6th 2011

NZDUSD between support and resistance, but losing some of the bullish momentum

The NZDUSD is between support at the 0.7972 level and resistance at the 0.8036 level where a nice ceiling has developed over the last few trading days (see hourly chart above).

The 0.7972 level is equal to the November 2010 old high price (see daily chart below).  Today the price fell and tested the key level for the second time in the last 3 trading days. On Thursday, the price dipped to the level but quickly rebounded.  Today’s test took out the 100 hour MA (blue line in the chart above) but found the support buyers at the 0.7972 level.  The rebound off the low has been less robust, however.  The price correction moved through the 38.2% of the days range but fell short of the 50% and the 100 and 200 bar MAs on the 5 minute chart (see chart below).  These levels at the 0.8005 level currently, will need to be broken to give the bulls some added confidence. Shorts can use this level as a stop.

Looking at the daily chart (see below), the price moved above the 0.7972 level on two separate occassions this month. The last was during the sharp dollar selling last week.  A break of an old high should solicit momentum buying but it seems the enthusiasm has waned a bit. 

As long as the price can remain above 0.7972, the bulls remain in charge. However, the move below the 100 hour MA and the limited rebound off the low – falling short of the 50% and the 100 and 200 bar MAs on the 5 minute chart – likely has the bulls concerned.  A break of 0.7972 should find more bulls looking to take profit and may also solicit some outright sellers. 

Kiwi Moves Lower on Dovish Comments

New Zealand’s Prime Minister Key suggested earlier that a rate cut could be in store for New Zealand. This report has pushed the Kiwi through the 2011 lows and could be about to test some long-term technicals. After breaking below trendline support that has defended the pairs depreciation since June 2010, the pair is now approaching thee 200 day mavg and 61.8% retracement below that. It will be interesting to see if those levels hold and risk regains a bid, as the USD is on the move across the board.

NZDUSD tests 100 hour MA at 0.7495

The expectations is that due to the devastating Christchurch earthquake, the growth projections for New Zealand will be slashed toward 0% growth. There are reports that the Reserve Bank of New Zealand may be forced to cut rates by as much as 50 basis points at it’s next meeting on March 10th. Already, ANZ has cut mortgage rates by 50 basis points. If the central bank matches the decline, this should keep the NZD pressured.

Looking at the NZDUSD, the pair has tested the 100 hour MA currently at the 0.7496 level on a number of occassions and is currently testing the level now. A break will likely lead to further selling with the double bottom from last weeks trade at the 0.7427 the next target.

Although the US dollar is having it’s own problems with consistent dollar selling, perhaps a move through technical support in the NZDUSD and the thought that lower rates are to come in NZ, may swing the pendulum toward NZDUSD bearish- at least for a time period.  Watch the technical level for the clue. 

As a reminder, I will be conducting a webinar today (March 1st) at 4 PM ET. The Topic:  “The 6 Attributes of Successful Forex Traders”.  To register go to www.fxdd.com/live and scroll down to todays webinar option.

A techincal look at the AUDUSD and the NZDUSD

RBNZ Interest Rate decision awaited

Today at 3PM the RBNZ will announce their interest rate decision with expectations of an unchanged decision. The NZDUSD has held the 200 hour MA in trading today. A break below is needed to switch the bias to the downside.

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