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– Westpac (based on The New Zealand Herald)
Pair's Outlook
The NZ Dollar lost just under 70 pips against the US Dollar on Friday, causing a breach of the four-month ascending channel's support line. Even though the cluster around 0.7235 managed to limit the losses that day, the NZD/USD pair might not be so lucky today. Ultimately, risks are skewed to the downside, with the 0.70 level being the main target and the weekly S1 and the Bollinger band forming support below. Technical indicators keep giving bearish signals in the daily timeframe, also suggesting the pair is to close in the red zone. However, we should not rule out the possibility of bulls pushing the Kiwi slightly higher, as corrections tend to take place after relatively sharp drops.
Traders' Sentiment
Market sentiment remains bearish, with 61% of traders holding short positions, while the share of sell orders increased dramatically to 85%.
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