The NZD is the weakest performing major currency today
A lot of the decline in the kiwi today owes to the fact of a break of key technical levels this year. The 38.2 retracement level @ 0.7187 and the 200-day MA (blue line) has been a level that has helped to stall declines in at least four attempts this year previously.
But it finally gave way yesterday.
The pair continues to extend declines today as it falls to a low of 0.7113, just shy of the 50.0 retracement level @ 0.7110 - a level I highlighted here yesterday should the pair find a daily close below the key levels mentioned above.
So, what's next for the pair?
I reckon this could be a level where sellers take a bit of a breather until the next catalyst kicks in. The dollar isn't looking too hot - or at least not yet - today, so the next push to the downside may just have to wait.
But if it does come, the next level to watch out for is the region between 0.7000 and the 61.8 retracement level @ 0.7032.
As for buyers, the first key step will be to get back above the 200-day MA and the 38.2 retracement level, otherwise sentiment will still be bearish in the pair.
