NZDUSD Tests A Support Zone Around 0.7850

NZDUSD lost ground overnight on the back of broad flock towards the US dollar, sending the pair to a support zone around 0.7850 – 200 4hr SMA, 61.8% from July's high and trend line support. A break here could see the sell-off intensify, while a failed break of this level could end the pair's recent downward trend. If the pair moves higher from here it would remain within its recent upward channel, which may be bullish and may see the pair break back above 0.8000 in the near-term.

However, the biggest event for NZDUSD, along with the rest of the market for that matter, is tonight's US labour market data. The market is expecting a change in NFP of around 185K and the unemployment rate to drop to 7.5% from 7.6%. Leading indicators and our proprietary model suggests that the market may be pleasantly surprised by the data, in which case the USD may increase in value.


Resistance

0.7910
0.7995 – 200hr SMA
0.8105


Support

0.7850
0.7725
0.7685 – low since June 2012

IMOH, Clement I.
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