50% retracement and 100 hour moving average holds support
A week ago, the NZDUSD closed the week at 0.7360. The stronger US employment report pushed the pair lower on that day. It closed near the lows for the day.
After a hangover Monday rally, the pair continued the fall to the downside, ultimately bottoming just prior to the RBNZ interest rate statement on Wednesday at the 0.7186.
The RBNZ kept rates as per expectations. Gov. Wheeler said that although the currency was overvalued, the economy was "growing at 3.25%" and that they were "projecting it to continue growth at those sorts of rates over the next 2 years".
The less dovish comments, made the NZD the king currency for the next day. The pair extended above the 200 hour MA (green line) for a brief moment, but was then hammered back down. Thursday set the high for the week.
On Friday, more selling sent the pair down to the 100 hour MA (blue line) and the 50% retracement. Those levels have stalled the selling. .
For the week, at 0.7319 currently, the price is 40 or so pips lower than last Friday's close (slight bearish).
The 100 hour MA is at 0.7316. The 50% of the weeks range is at 0.73143. From that perspective, we can't get any more neutral.
Looking a little further out, the 38.2% of the move up from the 2008 low to the 2011 and 2104 highs (they are nearly identical) comes in at 0.7328 - not that far from the currently level. Again, a fairly neutral level.
Certainly, like Gov Wheeler intimated with regard to rates when he said they could go either way, the market price of the NZDUSD can go either way too. Next week, the bullish and bearish line in the sand will be the 100 hour MA/50% retracement. On the topside, the 200 hour MA (green line) at 0,7400 area will be a level that will need to be broken to solicit more buying.
ON the downside, the 0.7284 (61.8% from the hourly chart) and the lows at 0.71755 and 0.71864 will be eyed.