Overview:
NZD/USD is seen to consolidate with bullish bias after hitting 17-month high of 0.8532 this morning, supported by stronger-than-expected 2.1% on quarter increase in New Zealand 4Q retail sales (vs +1.2% forecast), Kiwi demand on soft GBP/NZD, EUR/NZD and AUD/NZD crosses, and NZD-USD yield gap. But NZD/USD gains are tempered by decreased investor risk tolerance, weaker commodity prices, and positions adjustment before weekend. Daily chart is positively biased as MACD & stochastics are in bullish mode. Five-day moving average is above 15-day MA and is rising, bullish parabolic stop-and-reverse signal hit at 0.8473 Thursday.
Preference:
Buy above 0.846 with targets at 0.8535 and 0.856 in extension.
Resistance Levels:
R1 - 0.8535
R2 - 0.856
R3 - 0.895
Alternative scenario:
Sell below 0.846. Below 0.846 look for further downside with 0.843 and 0.8395 as targets.
Support Levels:
S1 - 0.843
S2 - 0.8392 (Wednesday's low)
S3 - 0.8331 (Tuesday's day)
Technical Comment:
The pair remains within a bullish channel.
