NZD/USD is trading in the red at 0.6786 level at the time of writing and it seems heavy after registering a false breakout with great separation above a strong dynamic resistance. The Dollar Index's rally forced the USD to appreciate versus its rivals.
The currency pair changed little in the last hours, even though the US Unemployment Claims indicator dropped unexpectedly lower from 227K to 184K, below 218K expected. Don't forget that the US inflation data will be released tomorrow. The CPI and the Core CPI are seen as high-impact events. Most likely, NZD/USD could register sharp movements in both directions around the US data dump tomorrow.
NZD/USD Another False Breakout!
NZD/USD rebounded after failing to stabilize below 0.6755 historical level. It has reached the median line (ML) where it has found resistance. As you can see, it has registered only a false breakout with great separation and now challenges the weekly pivot point (0.6784).
As long as it stays under the median line (ML), NZD/USD could come back down towards the 0.6755 or even lower towards 0.6736 lower low. Only a valid breakout above the median line (ML) could announce a larger upwards movement.
NZD/USD Outlook!
NZD/USD could extend its upwards movement only if it jumps and closes above the median line (ML) and above 0.6823 today's high. On the other hand, testing and retesting the median line (ML), registering only false breakouts could bring new short opportunities.
