The 100 hour and 100 day MAs stalled the rally at 0.7023
The NZDUSD snapped higher in the US session and in the process, tested the 100 hour and 100 day MAs at 0.7023 area (see blue lines in the chart below). The a pair fell below those lines in the London session after high prices from yesterday and again today stalled well short of its 200 hour moving average target (green line). That 200 hour moving average currently comes in at 0.70419.
The subsequent fall took the price back toward the swing low going back to last Friday's trade near 0.69957. The low price reached 0.69904 before ratcheting higher over the last five or six trading hours.
For the week, the high was reached on Monday's trade near 0.70805. That move took the price above its 100 hour moving average, but the break failed. That 100 hour moving average was broken again on Tuesday and again yesterday and today. What has not been broken is the 200 hour moving average (green line)
On the downside, the low was reached on Wednesday at 0.69791.
Fundamentally, the Reserve Bank of New Zealand is expected to raise rates for the second time by 0.25 basis points on Wednesday (Tuesday night in the US). That should be supportive but not always.
Back on October 6 when the RBNZ raised rates for the first time, the price initially moved from 0.6940 to a high on that day of 0.6979.
The price then declined - moving down to 0.6875 before closing the day near 0.6915. It wasn't until October 14 that the price extended above the rate raise day high, but then rose sharply up to a high price of 0.7218 by October 21 (7 calendar days later). On October 28, the price retested that high and stalled. Since then dollar buying has pushed the price down to the low price reached this week at 0.69791.
Once again the current price is near 0.7013. That is still above the October 6 high price at 0.6979, but well off the post hike high of 0.72179.
What will the price action be on Tuesday night/Wednesday morning? The current price seems to be happy near the moving average levels. If that remains, the bias will be help by the technicals. Move above the moving averages is more bullish. Stay below would be more bearish.
