• Last Candlesticks pattern: Shooting star
• Time of formation: 5 Sep 2016
• Trend bias: Down
• Last Candlesticks pattern: Hammer
• Time of formation: 14 Mar 2017
• Trend bias: Near term up
NZD/USD – 0.6974
As kiwi has eased after marginal rise to 0.7346 earlier this week, suggesting consolidation below this level would be seen and below 0.7250-55 would bring pullback to 0.7200, then towards 0.7171, however, reckon downside would be limited to 0.7100 and bring another rise later. Above said resistance at 0.7346 would extend recent upmove from 0.6818 low to previous resistance at 0.7376, having said that, loss of near term upward momentum should prevent sharp move beyond 0.7400 and price should falter below previous chart resistance at 0.7486.
On the downside, whilst initial pullback to 0.7200-10 cannot be ruled out, reckon downside would be limited to 0.7100 and bring another rise later. A daily close below support at 0.7058-60 would abort and suggest a temporary top is formed, bring weakness to 0.7005-10 but reckon downside would be limited to 0.6985-90 and previous resistance at 0.6950 should remain intact, bring another upmove later.
Recommendation: Buy at 0.7100 for 0.7300 with stop below 0.7000.
On the weekly chart, although kiwi edged higher this week and bullishness remains for the rise from 0.6818 to extend gain to previous resistance at 0.7376, break of another previous resistance at 0.7403 is needed to confirm early retreat from 0.7486 top has ended there, bring retest of this level later. Looking ahead, kiwi needs to penetrate this level to confirm erratic upmove from 0.6074 (2015 low) has resumed and extend gain to 0.7550 and later towards 0.7680 which is likely to hold from here.
On the downside, although pullback to 0.7200-10 is likely, reckon the Kijun-Sen (now at 0.7097) would limit downside and bring another rise later. Only below support at 0.7035 would suggest top is possibly formed, risk test of 0.7000 but downside should be limited to 0.6950 and bring another rebound later. Below 0.6915-20 would defer and suggest the rebound from 0.6818 has possibly ended instead, risk further fall to 0.6880 first but said recent low at 0.6820 should hold on initial testing.