Australian Dollar and New Zealand Dollar surge broadly today. Meanwhile Dollar is under heavy selling pressure as it’s possibly staging a broad based near term bearish reversal. As a result NZD/USD is the top mover for today up to now.
In the background, bullish convergence is seen in both 4 hour and Daily MACD. Adding to that, 55 day EMA is firmly taken out with today’s rally. The case of medium term reversal is building up. Immediate focus is now on 100% projection of 0.6424 to 0.6610 from 0.6464 at 0.6650. Firm break of this projection level will suggests that rise from 0.6424 is an impulsive wave, which further affirm the reversal case.
In that case, NZD/USD would target 38.2% retracement of 0.7436 to 0.6424 at 0.6811. Reactions from there will determine whether price actions from 0.6424 is the start of an up trend or just forming a corrective pattern. However, rejection from 0.6650, followed by break of 0.6573 minor support, will retain medium term bearishness and turn focus back to 0.6424 low.
