After rising for seven consecutive weeks since last December, the New Zealand dollar has been struggling to gain grounds since January end. In January, it reached a high of 0.743 area and retested it again in February, however, failed to break above its July peak around 0.755 area. It has been struggling since. New Zealand dollar is currently trading at 0.725 area.
The chart clearly shows that the New Zealand Dollar has been trading in a range of 700-800 pips since May 2016 and with the Kiwi dollar once again failing to break above the range, it is more likely that it would retest the range low, which makes the risk-reward ratio for the short trade very attractive.
Trade idea:
Sell NZD/USD at the current rate of 0.725 with the stop loss around 0.754 area and target of 0.675 area.
