© Dukascopy Bank SA
The pattern started on the 28th of January, 2013, when the pair dipped to 0.8281; currently it is trading slightly below the weekly pivot (PP) at 0.8430; gap between the pattern's support and resistance narrows by 140 pips in 50 bar period. Trading volume seems to be increasing in the length of the pattern. Technical indicators on aggregate point at further appreciation of the pair. Long traders could focus on the Bollinger band/weekly pivot (R1) at 0.8590/97, weekly pivot (R2) at 0.8657 and weekly pivot (R3)/pattern's resistance at 0.8727/54.
Current market sentiment is strongly bearish as 72% of traders are short on the pair and 59% of all pending orders are to sell the kiwi against the greenback as well. Short traders could focus on the 20-day SMA/weekly pivot (S1)/pattern's support at 0.8485/62, weekly pivot (S2)/100-day SMA/Bollinger band at 0.9397/82 and weekly pivot (S3)/200-day SMA at 0.8337/17.
Main fundamental events which could have significant impact on the pairs development in the near future are RBNZ Financial stability report announcement on 7th of May and Fed Chairman speech on 10th of May.
© Dukascopy Bank SA