SG chart on NZD/CAD - multi year resistance, short term hurdle ahead
Société Générale FX technical analysis note (overnight) makes a 'key point' on the pair
- Recovery in NZD/CAD appears to be drawing to a close after hitting the multiyear trend resistance at 0.92. It is worth noting that this represents the neckline of a multiyear double top confirmed last year, the affirmation level of a smaller Head and Shoulders and also the 50% retracement from last June highs. Monthly RSI is near a trend resistance suggesting 0.92 as a short term hurdle.
- Shorter term, the pair has reached the upper bound of an up sloping channel near 0.92. Daily stochastic is posting negative divergence denoting waning upside momentum and possibility of a pullback initially towards 0.90/0.8985, the lower bound of the channel. A break below will lead to resumption in down move further weakness towards 0.8850 and 0.8790/70, the 76.4% retracement of recent recovery. Potential for the double top will be at 0.8287.