The price of nzd/usd broke again the static support identified by 78.6% of the Fibonacci retracement. It's placed at 0.662 and the pair close the last week below it. Technically the trend has been declining since February 2018. It's starting from the area on 0.75 and has lost over 10 cents. Then bounced back to form this last wave of correction started in November 2018. This wave is ending its strength and is returning to the previous level, leading the price to break the support mentioned above.
All the main indicators and moving averages are projected downwards on short and medium term time frames. Moreover on monthly tf you can see a figure almost at the end of its conformation. Started in August 2015, this Head-shoulders is reaching its final phase with the right shoulder completed for 50%. Within a few weeks you should see a retest of the support area from which this figure started, ranging from about 0.634 to about 0.62.
This scenario is strongly supported by the macroeconomic studies. Thanks to the monetary policy that the two central banks of the respective countries are adopting, this downtrend should not change. In fact, in one hand the FED has slowed down its strongly restrictive policy. This by meeting the needs of the markets to Trump's requests. Without cutting rates and about to resume it. On the other hand, the New Zealand central bank, in the meeting of this night or in the next month, it will cut rates. This cut should be from 1.75% to 1.50%. This will cause a further devaluation of the New Zealand currency.
The price of nzd/usd broke again the static support, for this reason we recommend "short-term" short entry with the first TP at 0.649, according to TP at 0.642 and final target at 0.627. the SL will be set above the EMA20 weekly periods at 0.674.
All the main indicators and moving averages are projected downwards on short and medium term time frames. Moreover on monthly tf you can see a figure almost at the end of its conformation. Started in August 2015, this Head-shoulders is reaching its final phase with the right shoulder completed for 50%. Within a few weeks you should see a retest of the support area from which this figure started, ranging from about 0.634 to about 0.62.
This scenario is strongly supported by the macroeconomic studies. Thanks to the monetary policy that the two central banks of the respective countries are adopting, this downtrend should not change. In fact, in one hand the FED has slowed down its strongly restrictive policy. This by meeting the needs of the markets to Trump's requests. Without cutting rates and about to resume it. On the other hand, the New Zealand central bank, in the meeting of this night or in the next month, it will cut rates. This cut should be from 1.75% to 1.50%. This will cause a further devaluation of the New Zealand currency.
The price of nzd/usd broke again the static support, for this reason we recommend "short-term" short entry with the first TP at 0.649, according to TP at 0.642 and final target at 0.627. the SL will be set above the EMA20 weekly periods at 0.674.