NZD/USD increased in the early morning and looks determined to climb much higher as the dollar index drops again. Price resumed the Friday’s bullish candle, will jump much higher in the upcoming days if the USDX will approach the 92.55 previous low.
USDX dropped again in the last three days and could move in range on the short term till will recapture more bullish energy to be able to start a broader rebound. Only an accumulation movement will signal a reversal, the greenback needs a bullish spark from the US economy these days, otherwise will drop further.
The increased on the positive economic data, the New Zealand Retail Sales rose by 2.0% in Q2, beating the 1.6% growth in Q1, while the Core Retail Sales by 2.1%, more compared to the 1.5% in the previous reporting period.
Price increased after the false breakdown below the confluence formed between the 38.2% retracement level with the fourth warning line (wl4) of the former ascending pitchfork. A retest of the wl4 will confirm a further increase towards the 23.6% retracement level.
Only a failure to climb above the mentioned static resistance will send the rate down again on the short term. I’ve said in the last weeks that the perspective will remain bullish as long as the rate is located above the warning line (wl4), so only a valid breakdown will confirm a larger drop in the upcoming weeks.
