Technical Analysis

Kiwi buyers finally got their wish but can they build on the upside break?

NZD/USD manages a close above the 200-day moving average yesterday

ForexLive

And price is also holding above the swing highs in the past few weeks around 0.6720-30 so far today. That’s a positive sign as we begin proceedings but buyers will have some work to do in order to keep the momentum going.

The risk for buyers now is if price starts falling back below the 200-day MA (blue line) @ 0.6720 as well as the swing region between 0.6720-30. That will invalidate the break higher seen via yesterday’s closing price.

The kiwi has been on a roll this week owing to more steady inflation data, allowing the RBNZ to be less proactive in cutting rates for now since they already got ahead of the curve back in May. But the currency is also benefiting from cross-flows against its peer – the aussie – with AUD/NZD having slipped to fresh three-month lows yesterday.

AUD/NZD D1 18-07

The pair is recovering slightly on the day as the aussie firmed after the labour market report earlier, but as long as price doesn’t extend meaningfully beyond the support-turned-resistance around 1.0427, there’s still good reason for kiwi buyers to keep searching for a move higher as we look to wrap up the week.

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