NZD/USD: Declining highs suggest broad range is already in place - Westpac

Although daily momentum levels are neutral for NZD/USD, their patterns remain negative, which suggests that any interim rebounds are likely to be limited, Tim Riddell, Research Analyst at Westpac.

Key Quotes

“The 0.7300-30 area ought to cap rebounds with current bias skewed towards further slippage developing towards initially 0.7100-30 and potentially 0.7000.”

“Weekly

• Weekly indicators are also at neutral levels, but rolled negative after rebounds faltered in front of 0.7485. This underscores the bias for deeper corrections
• A series of weekly closes below 0.7200 would increase the potential for of a lower and corrective trading range developing during 4Q”

“Monthly

• Once again momentum is relatively neutral levels. Failure to regain the preceding rising channel reaffirms the potential of a protracted (downside) consolidation
• Rebound cannot be ruled out, but bias for range trading has become stronger given the contained upside moves. Risk of a pullback to 0.6725-50 remains high”