- NZD/USD extends gradual grind higher after bounce off 200-DMA on Aug 31st trade.
- The pair finds strong support at 20-DMA at 0.7243, we see weakness only on close below.
- Upside is struggling to break above 50-DMA at 0.7315, we see further upside only on break above.
- Technical studies are bullish, RSI and Stochs biased higher and we see bullish divergence on daily charts.
- US inflation data (due Thursday) will be in focus for fresh clues over the timing of next Fed rate hike move and eventually further direction in the pair.
Support levels - 0.7275 (38.2% Fib retrace of 0.6817 to 0.7558 rally), 0.7249 (5-DMA), 0.7243 (20-DMA)
Resistance levels - 0.73373 (Double top), 0.7391 (weekly 200-SMA), 0.7416 (Aug 7 high)
Recommendation: Good to go long on decisive break above 50-DMA, SL: 0.72, TP: 0.7340/ 0.7390/ 0.7415
FxWirePro Currency Strength Index: FxWirePro's Hourly NZD Spot Index was at 122.408 (Bullish), while Hourly USD Spot Index was at 42.446 (Neutral) at 1110 GMT. For more details on FxWirePro's Currency Strength Index, visit http://www.fxwirepro.com/currencyindex.
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