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Talking Points:
- NZD/USD Technical Strategy: Flat
- Support: 0.6956, 0.6871, 0.6786
- Resistance:0.7061, 0.7126, 0.7231
The New Zealand Dollar is on pace to secure a breach of the 0.69 figure as prices drop following disappointing first-quarter GDP data. Near-term support is at 0.6871, the 50% Fibonacci expansion, with a break below that on a daily closing basis exposing the 61.8% level at 0.6786. Alternatively, a move above the 38.2% Fib at 0.6956 opens the door for a test of the 0.7024-61 area (June 5 low, 23.6% expansion).
Prices are too close to support to justify entering short from a risk/reward perspective. On the other hand, the absence of a defined bullish reversal signal suggests that taking up the long side is premature. With that in mind, we will remain flat for now.
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--- Written by Ilya Spivak, Currency Strategist for DailyFX.com
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