NZD/USD Resistance Holds After Brief Clear-out

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NZD/USD Resistance Holds After Brief Clear-out

NZD/USD has been consolidating since December, after making a 2014-low at 0.7608. Despite what looks like a double bottom, price action has yet to give a bullish signal as it remains neutral to bearish.

The NZD/USD has found support in December at 0.7608 and resistance around 0.7850-0.7870. After the turn of the year, price failed to break lower, signaling a possible double bottom. However, price failed to clear 0.7850-0.7870 area as well, keeping NZD/USD neutral to bearish. This week, there was a stronger attempt that broke above 0.7870 but only briefly before being rejected back under 0.78.

The bullish outlook is unclear, but can be strengthened if price can hold above the SMA cluster in the 4H chart, around 0.7760. Below that the bullish bias is killed. Then below 0.7720 and a rising speedline, the bearish outlook might come back with pressure towards the 0.7608-0.7620 support area.

Now, if NZD/USd can hold above 0.7760, there will be upside risk towards the 0.79 handle, then the 0.7975 resistance, as well as resistance just above 0.80.

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Fan Yang has been a professional forex trader and analyst since 2007. He specializes in technical analysis and has a Chartered Market Technician designation since 2011. He was the chief technical strategist at CMSFX He was also the founder and chief currency strategist at FXTimes Over the years, Fan has not only been a trader and analyst but also an educator. As a proponent of both technical and fundamental analysis in trading, Fan advocates simplicity and discipline as key factors in making trading decisions when faced with so many "clues" and "signals". Currently Fan Yang is the chief currency analyst and webinar instructor at forexminute.com.