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26 Jun 2013
Flash: NZD/USD slide on the horizon – ANZ
FXstreet.com (New York) - The NZD/USDs failure to sustain the squeeze above 0.8100 and the slump below 0.7910 pushed aside (still mounting) divergence to trigger an extended slide to 0.7680-90, warns Tim Riddell, Head of Global Markets Research at ANZ.
Rebounds are not that encouraging and so risk of yet further slippage to test 0.7600 (or even previous lows at 0.7455) persists. That said, the level of divergence heightens the risk of another sharp squeeze if not a period of corrections. Rebounds above 0.7910 could force a squeeze.
NZD/USD technical bias remains unchanged
Indeed, little has changed – “the technical bias is that a structural top formed off the 2011 high (0.8845). The series of attempts to push above 0.8500 are seen as completing an interim consolidation phase. That leaves NZD/USD within a down-cycle that should test the 0.7335-0.7460 area. Rebounds are therefore seen as interim squeezes within this down-cycle.” Riddell adds.
Rebounds are not that encouraging and so risk of yet further slippage to test 0.7600 (or even previous lows at 0.7455) persists. That said, the level of divergence heightens the risk of another sharp squeeze if not a period of corrections. Rebounds above 0.7910 could force a squeeze.
NZD/USD technical bias remains unchanged
Indeed, little has changed – “the technical bias is that a structural top formed off the 2011 high (0.8845). The series of attempts to push above 0.8500 are seen as completing an interim consolidation phase. That leaves NZD/USD within a down-cycle that should test the 0.7335-0.7460 area. Rebounds are therefore seen as interim squeezes within this down-cycle.” Riddell adds.