- Saxo Bank (based on Reuters)
The Kiwi not only pierced the second resistance level yesterday, but also tested the third one, namely the upper trend-line of the channel. Today the NZD/USD is expected to bounce back and confirm the descending channel pattern once again. The monthly S1 is now the closest support level, although it is likely to be breached with no difficulty, while a slump back towards the 2010 low is not out of the question. Meanwhile, technical indicators shifted from bearish to mixed, despite the pair currently attempting to erase yesterday's gains.
Bears are now dominating the market, as 52% of all positions are short. The share of buy orders, however, edged up from 27 to 29%.