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Technical Outlook: Kiwi Dollar Falls Sharply On Political Uncertainty

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The Kiwi dollar fell sharply on Thursday in reaction on political uncertainty after New Zealand First Party joined a coalition with Labor and Greens to form government.

Traders reacted on such decision with strong selling of New Zealand dollar, which fell over 1.5% against the greenback in late Asian trading.

Fresh bearish acceleration broke below previous low of 10 Oct at 0.7055 and left lower top at 0.7146 (17 Oct high), signaling continuation of broader downtrend from 2017 high at 0.7558 (posted on 27 July).

Bears returned below cracked Fibo support at 0.7100 and pressuring psychological support at 0.7000.

Close below 0.7100 (Fibo 61.8% of 0.6817/0.7558, May/July rally) is needed to generate strong bearish signal, with sustained break below 0.7000 handle to open way towards key med-term support at 0.6817 (2017 low, posted on 11 May).

Daily indicators are in full bearish setup (20/200 SMA Death-Cross is forming) and supportive for further weakness.

Broken 10SMA (0.7114) is expected to cap upticks and keep fresh bears intact.

Res: 0.7055, 0.7073, 0.7114, 0.7160
Sup: 0.7037, 0.7000, 0.6950, 0.6910

Author: Windsor Brokers LtdWebsite: http://www.windsorbrokers.com/
Windsor Brokers Ltd
The information contained in this document was obtained from sources believed to be reliable, but its accuracy or completeness cannot be guaranteed. Any opinions expressed herein are in good faith, but are subject to change without notice. No liability accepted whatsoever for any direct or consequential loss arising from the use of this document.
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