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Technical Analysis – NZDUSD strongly bearish below 0.7000

The downside bias for NZDUSD remains strong after prices fell further on Friday to a new 5-year low of 0.6941.The pair has been unable to reclaim the key psychological level of 0.7000 giving the likelihood of further weakness. Prices continue to track the lower Bollinger line and this supports the bearish bias.

Immediate support lies at Friday’s low of 0.6941, while the next support lies at 0.6885, which is the 50% Fibonacci retracement level of the upleg from 0.4881 to 0.8846 (2009 to 2011 rise). To the upside, 0.7000 is an important barrier where prices could bounce back down from.

The overall outlook for NZDUSD is bearish and the market has been in a downtrend since the July 2014 high of 0.8835. RSI is in bearish territory below 50 and the Bollinger Bands are falling – all of which are bearish signals.

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