Short-term NZD/USD Likely Keeps Momentum to Upside

By: Eddy Peng Jun 5, 2018
On a daily chart, NZD/USD surged after fluctuating above 0.6979 (23.6% retracement) for two days, when an intersect of MA20 and MA5 was preparing to push the pair higher. The intraday price for today still kept rising, but seems to be struggling to go further as there’s a resistance hurdle ahead near 0.7059 (38.2% retracement). In the event that the pair fails to break out higher, some retracement may be seen in the next few days. However, higher lows of RSI and rising MACD shows bullish momentum may continue for a period of time. If the pair keeps rising, there’s a point that we need to beware of and start considering a sell-off action when RSI in the overbought area pulls back to 70. ACY-NZDUSD-Daily-050618 Short-term NZD/USD Likely Keeps Momentum to Upside

Chart 1: NZD/USD Daily

Back to look at the DXY’s daily chart, we could find the negative RSI divergence is present and shows that momentum to the upside is ebbing, supporting NZD/USD to rise further over the short term, a prediction that I have made in the last paragraph. Besides, the DXY has been struggling below 38.2% Fibonacci retracement for a couple of days, meaning that the resistance ahead is quite tough and the greenback likely retreats later to find support near 93.214. All in all, we don’t see that the DXY will remain uptrend this week, but the long-term upswing will probably continue based on the robust economic performance in the U.S., so then it may keep NZD/USD under pressure. ACY-USD-Index-Daily-050618 Short-term NZD/USD Likely Keeps Momentum to Upside

Chart 2: USD Index Daily

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