NZD/USD tests flag support as pointed out on Monday, What’s next?

Kiwi tested 0.67 handle (flag support) as anticipated here NZD/USD looking bearish on charts & Week ahead – Oil overbought, GBP/USD bullish break and NZD/USD short hedge on Monday.

Daily Chart

NZDUSD D1 (03-23-2016 1658).png

Spot has found support at 0.67 handle and has recovered to trade around 0.6720 levels.

Kiwi remains bearish, but further losses would requires acceptance below 0.67, which is rising trendline support, which would strengthen beer grip around Kiwi and result in short-term bullish invalidation.

The spot would descend to another rising trend line support seen around 0.6610 levels.

Conversely, a rebound from the flag support tomorrow coupled with bullish daily RSI would indicate spot is heading back to 0.68, which if taken out would shift risk in favor of a rally to flag resistance at around 0.6870


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