TechnoMeter

The New Zealand Dollar looks set to test below the 0.76 figure against the US Dollar after narrowly overcoming chart support. A daily close below the 0.7556-80 area marked by the bottom of a falling channel and the 23.6% Fibonacci expansion exposes 38.2% level at 0.7401. Alternatively, a reversal back above the 14.6% Fib at 0.7691 opens the door for a test of channel top resistance at 0.7827.

A very narrow break of support and the Hammer-like structure of the latest candle hint at elevated false breakout risk. With that in mind, we will tactically opt not to pursue a short position at this time and remain on the sidelines, waiting for a more attractive opportunity to present itself.



--- Written by Ilya Spivak, Currency Strategist for DailyFX.com



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