FxWirePro: NZD/USD breaks below 20-DMA, bias lower, stay short

• NZD/USD has broken below strong support at 20-DMA at 0.7320. We see scope for further drag.
   
• The pair is extending downside after rejection at major trendline resistance, has slipped below 0.73 handle.
   
• Kiwi ignores upbeat New Zealand retail sales data. NZ Retail Sales printed at 1.7%, above forecast at 1.4% and far outpacing the previous figure of 0.3%.
   
• Technical studies have turned bearish. RSI and Stochs are biased lower.
   
• Violation at 20-DMA finds next major support at 23.6% Fib at 0.7281 ahead of trendline at 0.7270.
   
• On the flipside, 5-DMA at 0.7334 is strong resistance. Retrace and close above could see retest of trendline at 0.7435.

Support levels - 0.7281 (23.6% Fib retrace of 0.6780 to 0.7435 rally), 0.7270 (trendline), 0.7227 (55-EMA)

Resistance levels - 0.73, 0.7334 (5-DMA), 0.74, 0.7435 (trendline)

Call update: Our previous call (https://www.econotimes.com/FxWirePro-NZD-USD-breaks-below-5-DMA-on-track-to-test-20-DMA-at-07323-1157803) has hit TP1/2.

Recommendation: Book partial profits. Trail stop loss to 0.7335, hold for further weakness.

FxWirePro Currency Strength Index: FxWirePro's Hourly NZD Spot Index was at -112.154 (Bearish), while Hourly USD Spot Index was at 92.4347 (Bullish) at 0430 GMT. For more details on FxWirePro's Currency Strength Index, visit http://www.fxwirepro.com/currencyindex.

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