NZD/USD: Technical Movement in the Channel
Since the end of January the pair NZD/USD has been in the narrow ascending channel on the daily chart. This week, the pair has grown from the level of 0.6400 by 650 points this week, reaching annual highs at the level of 0.7050. However, for the third consecutive day the pair has declined. In anticipation of the meetings of the US Fed and RBNZ at the end of April, traders started to adjust positions, closing short orders.
On 4-hour chart the price has broken out the lower limit of the ascending channel at the level of 0.6910, continuing downward movement.
From the technical point of view the price can rebound from the lower limit of the ascending channel on the daily chart at the level of 0.6830 (ЕМА200 on 4-hour chart) and continue to upward movement in the channel.
However, fundamental factors show possibility of trend reversal and pong positions.
After consolidation of the price below the level of 0.6790 (ЕМА200on the daily chart, the pair NZD/USD will reverse and return to the down trend.
On the 4-hour and daily charts the indicators OsMA and Stochastic give signals to sell. On the weekly chart the indicators are also reversing towards the short positions.
As an alternative scenario the pair may go up in the ascending corrective channel on the daily chart with the upper limit near the level of 0.7100 (Fibonacci 38.2%) in case of support from the indicators and fundamental data. Meanwhile the data is in favour of the sellers.
Support levels: 0.6860, 0.6830, 0.6790, 0.6700 and 0.6610.
Resistance levels: 0.6910 and 0.7050.
Sell on the market. Stop-Loss: 0.6910. Take-Profit: 0.6860, 0.6830, 0.6790, 0.6700, 0.6650, 0.6610, 0.6410 and 0.6300.
Buy Stop: 0.6930. Stop-Loss: 0.6890. Take-Profit: 0.6965, 0.7000, 0.7050, 0.7100 and 0.7240.