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Technical Analysis: NZD/USD Fell to 0.6480 14 DMA, Risk Aversion Remains

Posted by Chris Advincula on Nov 16, 2015 9:42:55 AM

The new zealand dollar fell to 0.6474 from the 0.6542 high in Europe (-68 pips) breaking the 0.6510 support, hitting stops at 0.6500 and 0.6490. The NZD continues to decline showing the effects of risk aversion being still intact on the soft expectations of the upcoming Fonterra dairy auction on Tuesday, and while the market continutes to digest the post effects of the terrorist attacks in Paris last Friday. The NZD also has been weighed down by the NZD/JPY's selling from 80.30 to 79.60 (-90 pips) on yen safe haven demand.

The early Asian high of 0.6546 high was made after the better than expected NZD 3rd QTR Retail Sales +1.6% vs +1.25% forecast, only to be erased when Europe came in selling, breaking several support levels from 0.6510, 0.6500 and 0.6490 taking out stops. The kiwi is holding for now at the 14 DMA level of 0.6480.

On the daily chart, the 14 DMA has eased down from 0.6700 to 0.6600 (pink line) while the 30 DMA (blue line) has bounced from 0.6400 to 0.6700 with the lines crossing at 0.6650 - which is the next pivot point to watch, if broken, a rebound can bring it back to 0.6820. The 14-DMA RSI has not successfuly broken the important 25 level and has retraced to the 70 top whiich is 0.6830 on the spot NZD level. The most recent decline to 35 from 70 on the 14 DMA RSI has been indicative of a moderate bearish trend subject to breaking 25.

 

Charts: WorldWideMarkets Alpha Trader

 

 

Topics: technical anlaysis, European Session, Forex Market, NZDUSD, NZDJPY

 

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