NZD/USD: up and down
There’s a potential head and shoulders on NZD/USD chart. However, support around the neckline at $0.8190 with the 200-day MA and the Ichimoku Cloud nearby has proved to rather strong. NZD remains supported due to the diverging stance by the RBNZ and the Fed.
Today New Zealand’s dollar spiked up to $0.8350 before returning to $0.8262. New Zealand’s retail sales came lower than expected. We expect more volatility ahead, especially as the Fed’s nominee Yellen testifies (15:00 GMT).
On the downside, a break below $0.8190 is needed to confirm an important top. Kiwi will probably once again test $0.8200. The prospects won’t become bullish until kiwi is below $0.8420.
Chart. Daily NZD/USD