NZD/USD At A Critical Juncture With A Bullish Signal In Its Wake

Talking Points

• NZD/USD Technical Strategy: Sidelines Preferred
• Hammer Candlestick Pattern Offers Bullish Reversal Signal
• Climb Over 0.8400 Needed To Suggest A Sustained Recovery

The Kiwi bulls appear to have lost steam after hitting the 0.8400 ceiling. Clearance of the critical hurdle alongside the Hammer formation on the daily would be required to suggest the potential for a more sustained recovery for NZD/USD. Yet some skepticism over further gains may be warranted given the backdrop of a pronounced downtrend.

NZD/USD: Hammer Offered Sign of Hope To The Bulls

Daily Chart - Created Using FXCM Marketscope 2.0, Volume Indicator Available Here

A Hammer formation offered an early indication of an intraday bounce for the Kiwi near 0.8343. The bullish reversal formation suggests a retest of the 0.8400 mark. However, given the context afforded by the daily, further gains beyond the barrier may be difficult to achieve.

NZD/USD: Hammer Offered Intraday Turning Point Signal

Four Hour Chart - Created Using FXCM Marketscope 2.0, Volume Indicator Available Here

By David de Ferranti, Currency Analyst, DailyFX

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