Forex Technical Update

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The NZD/USD broken below an important cluster when it crossed 0.79-0.7880 area. There was a projected support, and the 200 period simple moving average in the 4H chart. This move also pushed the RSI below 30, establishing bearish momentum in the short-term. The question is whether this bearish push will extend. We have a pullback in the 11/3 Europea-US session, and so far, the market has been respecting the broken cluster. If the market now pushes back below 0.78, we would have confirmation of a break, in they style of a sling shot (where price crosses a moving average, re-tests it, and continues in the direction of the breakout.

The sling shot can target the 0.7468 low in the medium term, but in the short-term there are some fibonacci retracement levels to watch out for as support. The 0.7763 level is 61.8% retracement, and a pivot seen Oct 12 and 18. Then the 78.6% retracement level is at 0.7633 and was also a pivot during Oct 4-6.

Fan Yang CMT is the Chief Technical Strategist FXTimes - provider of Forex News, Analysis, Education, Videos, Charts, and other trading resources.