Weekly
• Last Candlesticks pattern: N/A
• Time of formation: N/A
• Trend bias: Up
Daily
• Last Candlesticks pattern: Long black candlestick
• Time of formation: 1 Aug 2017
• Trend bias: Up
NZD/USD – 0.7237
Although kiwi retreated from 0.7338, as the pair found support at 0.7217 and has rebounded again, suggesting further consolidation above support at 0.7132 would be seen and upside risk remains for gain to 0.7345 (50% Fibonacci retracement of 0.7558-0.7132), however, reckon upside would be limited to 0.7395-00 (61.8% Fibonacci retracement) and bring retreat later. A break of 0.7217 would suggest the rebound from 0.7132 has ended, bring retest of this level, break there would extend the fall from 0.7558 to 0.7095-00 but loss of downward momentum should prevent sharp fall below 0.7050 and price should stay well above psychological support at 0.7000, bring rebound later.
On the upside, whilst initial recovery to 0.7345 cannot be ruled out, reckon upside would be limited to the 0.7395-00 (61.8% Fibonacci retracement of 0.7558-0.7132) and bring another decline later. A daily close above 0.7400 would risk test of resistance at 0.7455-60, break there would signal the fall from 0.7558 has ended instead, risk a stronger rebound to 0.7495-00 but upside would still be limited and price should falter well below said resistance at 0.7558, bring another retreat later.
Recommendation: Sell at 0.7395 for 0.7195 with stop below 0.7495.
On the weekly chart, last week’s rebound formed a white candlestick, suggesting further consolidation above 0.7132 support would be seen and initial upside risk remains for recovery to 0.7395-00 (61.8% Fibonacci retracement of 0.7558-0.7132), as the sharp retreat from 0.7558 suggests top has possibly been formed there, reckon upside would be limited and bring another decline, below 0.7217 would bring retest of 0.7132 but break there is needed to retain bearishness and extend the retreat from 0.7558 for retracement of recent rise to the lower Kumo (now at 0.7077) and psychological support at 0.7000 would limit downside, kiwi shall stay above 0.6950.
On the upside, expect recovery to be limited to 0.7395-00 (61.8% Fibonacci retracement of 0.7558-0.7132) and bring another decline later. Above 0.7417 resistance would risk a stronger rebound to 0.7490-00 but still reckon said resistance at 0.7558 would limit upside and bring another retreat later. Only a break of 0.7559 would extend medium term erratic upmove from 0.6074 (2015 low) has resumed and may extend gain to 0.7690-00 (61.8% projection of 0.6074-0.7485 measuring from 0.6818) and later towards 0.7780-85 (61.8% Fibonacci retracement of 0.8836-0.6074), however, reckon upside would be limited to 0.7890 and price should falter well below resistance at 0.8035.
