NZD/USD: technical update
The New Zealand currency is trading a bit lower on Thursday, pressured by weak Australian data and China concerns. The June-July recovery from $0.7680 continues, but for now remains limited by 23.6% Fibo from the April-June drop (around $0.7915).
BNZ: Bernanke's testimony leaves us more comfortable with our view that the NZD/USD is more likely to stabilize in a sideways, to slightly higher range, than to keep falling. Short-term fair-value is still seen in a $0.7850/0.8250 range. As long as Chinese growth concerns remain at bay, we suspect the NZD/USD will spend most of the next few weeks inside this range.
Chart. Daily NZD/USD