- The NZD / USD has been on the defensive in recent trading and has reversed from highs just below 0.7100 towards 0.7000.
- Selling was exacerbated when the pair broke below a short-term uptrend.
Amid a deterioration in the broader market appetite for risk in recent trading, NZD / USD It has reversed from previous highs just below the 0.7100 level and is heading towards the 0.7000 level. The pair rallied to this point during Wednesday in Asia and early European trading in tandem with a strong AUD on the back of strong Westpac consumer sentiment numbers. In fact, the NZD could also have picked up some momentum thanks to strong New Zealand Manufacturing Sales Volumes figures for the third quarter released early in the Asia Pacific session. Regardless, amid the recent pullback, the pair is now trading at losses of more than 0.2% or 20 pips on the day.
NZD / USD falls below recent short-term uptrend
The NZD / USD has dipped below a short-term bullish trend in recent trade that linked the lows of December 7 and 8. The uptrend came into play as support in the 0.7050 area. Now that the pair has broken below this uptrend, eyes are on support just ahead of the 0.7000 level. If this key psychological level disappears, the door will have opened for a move lower towards the pair’s 21-day moving average at 0.6971. Conversely, if the bears regain control, the NZD / USD could rally towards Wednesday’s highs at 0.7096 and could even test the 0.7100 level and last week’s high just above it at 0.7105.
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