• GBP/ NZD extended its drop on Wednesday as strong New Zealand employment data solidified expectations for a rate hike this month as policymakers attempt to cool a hot economy.
• New Zealand dollar rose sharply against pound after data showed New Zealand’s jobless rate dropped sharply to 4.0% last quarter.
• The pair attempted to breach support at 1.9670 (50% fib) and recovered towards 1.9724 level . A decisive break closure below (50% fib could increase further downside.
• Technical signals show the pair could fall further in the short-term as RSI is at 47 bearish, daily momentum studies 5, 9 and 11 DMAs are trending down.
• Immediate resistance is located at 1.9757 (61.8% fib), any close above will push the pair towards 1.9855 (5DMA).
• Immediate support is seen at 1.9670 (50% fib) and break below could take the pair towards 1.9577 (38.2%fib).
Recommendation: Good to sell around 1.9730, with stop loss of 1.9830 and target price of 1.9630
