The New Zealand dollar remains firmly in red on Friday and broke below psychological 0.7000 support. Fresh extension of strong fall on Thursday hit new five-month low at 0.6970, with scope seen for further weakness. The Kiwi dollar is under pressure on political uncertainty while the greenback received fresh boost on hopes of implementation of President Trump’s tax package. Technical studies are in firm bearish mode and favor further easing, as Thursday’s long red daily candle (the pair was down 1.7% on Thursday) weighs heavily on near-term action. The pair is currently riding on the wave C of five-wave cycle from 0.7558, which broke below its FE 100% (0.7008) and could travel to 0.6907 (FE123.6%) and 0.6844 (FE138.2%) in extension. Initial resistance lies at 0.7055 (10 Oct former low), with falling 10SMA (0.7102) expected to cap corrective upticks.
Res: 0.7000, 0.7055, 0.7090, 0.7102
Sup: 0.6970, 0.6950, 0.6907, 0.6844
