I’ve been watching this pair for the past few trading days and like what i’m seeing, as far as a bearish trade is concerned. You can see the three failures at the 50% retracement (64.59) of the nice dip and partial rise. New Zealand’s data of late has been rather poor when it comes to employment, retail sales and with the exception of food prices, other prices have been cool. In fact, cold. Inflation data comes out at 9 pm eastern time, tonight. Obviously, a rate hike, isn’t on the horizon, anytime soon. So far, daily MACD is still bearish and RSI is cruising around the 51 level. Nothing to get bullish over, yet. That being said, I think this is nothing more than an oversold correction of the pair and will continue down. It all depends on risk appetite. Watch daily RSI to see if performs similarly to the blue circled area. This is a good spot to allow daily RSI to lead you into the flows. If risk is on and RSI is gaining good strength (54+ and gaining), price breaks the 50% retracement of 64.59 and looks like strength will drag MACD bullish, let’r rip to the upside. If risk aversion ramps up (I think we are at the beginning of a prolonged period of risk off) and RSI starts dipping hard, short it. I’ll keep the topic updated, as i’ll be looking to trade it. Might even trade it to the downside going into the inflation report tonight. But I always get burned, trading reports. Though, risk/reward may be worth it, with a tight stop loss.
Just in case- http://s798.photobucket.com/albums/yy266/bigmillers/?action=view¤t=kiwi.jpg