The New Zealand Dollar fell as expected against its US namesake after putting in a Bearish Engulfing candlestick pattern. A bounce from support in the 0.8391-0.8415 area, marked by a horizontal pivot in play since September and the 50% Fibonacci retracement, has opened the door for a test of the 0.85 figure. This is reinforced by support-turned-resistance at 0.8527. A daily close above the latter level exposes the 23.6% level at 0.8607. Alternatively, a reversal below support on a daily closing basis eyes the 61.8% Fib at 0.8329.
We entered short NZDUSD at 0.8493. We subsequently booked profit on half of the position at the first target and left the remainder with an updated stop-loss at the breakeven level, which has now been triggered. The overall trend continues to look bearish and we will look for new selling opportunities in the days ahead.