Chart Of The Day: NZD/USD

10/01/2008 - NZD/USD - Price action on the NZD/USD daily chart, as shown, has bounced up off of a significant downtrend line (marked "A") in what appears to be a pullback move after price broke out above the line on 9/19/2008 and subsequently reached up to a key 38.2% Fibonacci retracement level. This breakout-pullback formation could be hinting at a possible continuation to the upside in the direction of the original break. To confirm such a move would necessitate a breakout above the swing high that was reached after breakout, around the 0.6950 level. This price level also serves as the next key resistance to the upside if price carries further bullish momentum going forward. On the downside, the aforementioned downtrend line should continue to serve as support where it originally acted as resistance before breakout. Further strong support resides around the key 0.6440 historical support/resistance level.

James Chen
Chief Technical Analyst

FX Solutions

IMPORTANT NOTICE: These comments are for information purposes only. Past results are not necessarily indicative of future results. Trading Futures, Options on Futures, and Foreign Exchange involves substantial risk of loss and may not be suitable for all investors. You should carefully consider whether trading is suitable for you in light of your circumstances, knowledge, and financial resources. You may lose all or more of your initial investment. Opinions, market data, and recommendations are subject to change at any time. The information contained on this email does not constitute a solicitation to buy or sell by FX Solutions,LLC., and/or its affiliates, and is not to be available to individuals in a jurisdiction where such availability would be contrary to local regulation or law.

(Chart courtesy of FX Solutions' FX AccuCharts. Price on 1st pane, Slow Stochastics on 2nd pane; uptrend lines in green; downtrend lines in red; horizontal support/resistance lines in yellow; 200-period simple moving average in light blue.)