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FXTimes | September 16 2011 9:07 EDT
Previous: Outlook for NZD/USD Based on Wave Structure; Case for 0.77 (9/7)
NZD/USD
The NZD/USD chart in the 1H time-frame is showing a confirmation of a double bottom. 1) a break above 0.8260 establishes the bottoming pattern. Price action at this borderline was strong, and also broke above the 200 simple moving average. 2) The RSI has broken above 60, and is now kissing 70. These are all signs of a successful bottoming attempt. The bearish outlook for NZD/USD towards 0.80 and then 0.77 has to wait for further correction, and if this “correction” takes on life of a bullish trend, the bearish outlook is invalid. The market is now testing an immediate resistance pivot above at 0.83-0.8310. This is an important resistanve pivot, and when you look at the 4H chart, testing this level coincides with the RSI testing 60. If the RSI breaks above 60, the bearish momentum since falling at the end of August, would be gone. A break above the 0.83-0.8310 level and NZD/USD opens up some further bullish outlook in the short-term towards 0.8380. This is the next important pivot because if the NZD/USD stays below it, and breaks back below 0.8260, the bearish scenario is still alive, just very choppy. However, a break above 0.8380, 0.84 should hint at further bullish attempt towards 0.8550 near the August highs.
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Fan Yang CMT
Chief Technical Strategist
FXTimes
Information and opinions contained in this report are for educational purposes only and do not constitute an investment advice. While the information contained herein was obtained from sources believed to be reliable, author does not guarantee its accuracy or completeness. FXTimes will not accept liability for any loss of profit or damage which may arise directly, indirectly or consequently from use of or reliance on the trading set-ups or any accompanying chart analysis.
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