FxWirePro: NZD/USD holds 200-DMA support, further weakness only on break below

• NZD/USD has broken major trendline support at 0.7175 and hit 4-week lows at 0.7148.
   
• Kiwi falls against major peers as business confidence, capacity utilisation data fail to meet expectations.
   
• New Zealand Q3 business confidence fell to an 18-month low of 5 pct vs 18 pct in the previous quarter.
   
• Greenback extended gains on upbeat September ISM data which outpaced prior expectations at 60.8 from 58.8 in August.
   
• The major finds strong support by 200-DMA at 0.7152, we see further weakness on break below.
   
• Momentum indicators are still bearish, RSI below 50 biased lower, MACD supports downside.
   
• Break below 200-DMA raises scope for test of 0.6975 (major trendline).
   
• On the flipside, 20-DMA at 0.7251 is stiff resistance, we see bearish invalidation only on close above.

Support levels - 0.7152 (200-DMA), 0.71 (61.8% Fib retracement of 0.68176 to 0.75580 rally), 0.7057 (June 1 low)

Resistance levels - 0.7201 (5-DMA), 0.7252 (20-DMA), 0.7275 (38.2% Fib)

Call update: Our previous call (https://www.econotimes.com/FxWirePro-NZD-USD-hovers-around-major-trendline-support-at-072-bias-lower-stay-short-920760) has hit all targets.

Recommendation: Book full profits. Watch out for breach of 200-DMA support for further weakness.

FxWirePro Currency Strength Index: FxWirePro's Hourly NZD Spot Index was at -45.9592 (Neutral), while Hourly USD Spot Index was at 31.4605 (Neutral) at 0700 GMT. For more details on FxWirePro's Currency Strength Index, visit http://www.fxwirepro.com/currencyindex.

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