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NZDUSD Setting Up For Break?

Key Points

  • New Zealand Dollar after trading towards 0.6750 found support against the US Dollar and started to move higher.
  • There is a bearish trend line formed on the hourly chart of the NZDUSD pair, which if broken could ignite a rally in the near term.
  • Earlier today, the Caixin China Services PMI™, released by Markit Economics posted a rise from 51.2 to 52.2 for March 2016.
  • US MBA Mortgage Applications released by the Mortgage Bankers Association came in at 2.7%, better than the last reading.

Technical Analysis

The New Zealand Dollar recently moved down towards 0.6750 level against the US Dollar where it found bids and started to recover. Currently, the NZDUSD pair is facing sellers near a bearish trend line formed on the hourly chart.

NZDUSD

The most important point is that above the trend line, the 200 hourly simple moving average is positioned. So, it won’t be easy for the bulls to break the highlighted resistance area in the chart.

On the downside, an initial support can be at 0.6780, followed by the 0.6750 level.

US MBA Mortgage Applications

Earlier today, the US MBA Mortgage Applications highlighting various mortgage applications was released by the Mortgage Bankers Association. The outcome was positive, as there was a rise of 2.7% in the applications.

Today, all eyes will be on the FOMC meeting minutes, which determines the appropriate stance of monetary policy and assesses the risks to its long-run goals. It may impact the US dollar in the near term. So, we need to monitor our trades well before and after the event.

Overall, if the NZDUSD pair manages to break the trend line resistance area, then more upsides are possible.

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