By: Mike Kulej
After a prolonged rally, the New Zealand Dollar reached a high of 0.7394 against the US Dollar. That happened in early July. Since then, the NZD/USD has been drifting lower, a move that gained momentum couple of weeks ago, and undercut the minor low of 0.7027.
The price found support at 0.6996.
On Friday, another run on the low was stopped at 0.7000. This double figure area is proving to be a formidable obstacle. Not only is it an important psychological level, as most round figures are, but there are other supportive elements here as well. By now, the daily chart is showing two minor lows at 0.7000 and 100 SMA is also right above it. Currently the price is sitting right on it.
Another technical indicator providing support is the lower Bollinger Band. In spite of that, the NZD/USD does not seem to rebound much. This means that market pressure is building on the sell side. A breakout under 0.7000 would indicate a bearish trend under way, with next support 0.6800 and 0.6600 after that. For now, the support is holding, but it is worth watching for signs of weakness.
NZD/USD Testing Support
DailyForex.com