The NZDUSD traded to the highest level in 2024 just last week (eight trading days ago). The high price reached 0.63778. Today after they are beyond the cut rates by 50 basis points, the price low traded to 0.60516. That’s 327 pips in a trading days.
Technically the decline seen in trading today has taken the price below a cluster of technical levels including the:
- 100 day moving average and 0.61218
- 50% midpoint of the 2024 range at 0.6113
- 200 day moving average of 0.60966
The price has also moved into and today low of a swing area going back 20 months between 0.6050 and 0.6084, and down to the 61.8% retracement of the 2024 trading range at 0.60509. The low price today fell to just above that retracement level.
If buyers are to take profit. This would be the area to buy against but I would do it with a stop if the price starts to trade more comfortably below that 61.8% retracement level. If the level can hold, there could be a corrective probe back toward the 200 day MA. However, I would not to want to see the price move above the 100 day MA IF the sellers are intent on keeping more control.
This article was written by Greg Michalowski at www.forexlive.com. Source