(MENAFN- DailyFX) Updated weekly technicals on NZD/USD- rebound testing key down-trend resistance Check out our 4Q projections in our Join Michael for Live Weekly Strategy Webinars on In this series we scale-back and take a look at the broader technical picture to gain a bit more perspective on where we are in trend. The has rallied nearly 5% off the yearly lows with price now targeting critical down-trend resistance. Here are the key targets & invalidation levels that matter on the NZD/USD weekly chart. for an in-depth breakdown of this setup and more.
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NZD/USD Weekly Price Chart Notes: In last month's we highlighted a critical support confluence at 6453/88 a region defined by the 2015 low-week close, the sliding parallel of the broader descending slope (red) and the median-line of the extending off the 2017/2018 highs. Price registered a low at 6424 the following week before reversing sharply higher with the advance now testing a critical resistance range at 6811/54 where the 38.2% retracement of the yearly range converges on the 2017 low-week close and down-slope resistance (blue).
The focus is on a reaction off this key zone with the immediate long-bias at risk while below. Interim support rests at the trendline confluence around ~6640s backed by the low-week close at 6506. Ultimately a break below 6453 would be needed to mark resumption of the broader downtrend targeting the 2016 lows at 6347. A topside breach / close above this formation would suggest a more significant low is in place with such scenario targeting the 50% / 52-week moving average at 6930/32.
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Bottom line:Kiwi is testing weekly resistance at 6811/54 and the risk for near-term exhaustion remains while below this level. From a trading standpoint, the immediate threat is lower but ultimately a set-back would offer more favorable long-entries while above 6506. I'll publish an updated once we get further clarity on near-term price action- for now, look for a break of the 66406854 range for guidance.
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NZD/USD Trader Sentiment A summary of shows traders are net-long NZD/USD - the ratio stands at +1.17 (53.9% of traders are long) weak bearish reading Long positions are8.7% higher than yesterday and 13.1% lower from last week Short positions are 2.0% lower than yesterday and 10.9% higher from last week We typically take a contrarian view to crowd sentiment, and the fact traders are net-long suggests NZD / USD prices may continue to fall. However, traders are more net-long than yesterday but less net-long from last week and the combination of current positioning and recent changes gives us a further mixed NZDUSD trading bias from a sentiment standpoint. See how shifts in NZD/USD retail positioning are impacting trend-
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--- Written by , Technical Currency Strategist with DailyFX
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