Yesterday the pair demonstrated choppy trade but closed at the opening levels.
The pair was supported by strong data on Manufacturing Sales in New Zealand that in the third quarter of the year grew by 3.5%, while in the previous quarter the index showed a 0.2% contraction. At the same time, the pair was pressured by poor data from China where Exports in November fell by 6.8%, against predicted 5.0% decline.
Support and resistance
Bollinger Bands on the daily chart is turning horizontally while the price range remains unchanged. MACD is falling and giving a weak sell signal. Stochastic is moving down and approaching the oversold zone indicating that the downward impulse in the pair is weakening.
The indicators recommend waiting for clearer trading signals.
Support levels: 0.6600 (bottom border of the flat channel), 0.6560, 0.6534, 0.6500, 0.6457, 0.6428 (18 November low), 0.6400, 0.6344.
Resistance levels: 0.6660 (local high), 0.6687, 0.6724, 0.6791 (30 October high), 0.6812 (27 October high), 0.6865 (23 October high), 0.6900.
Long positions can be opened after the breakout of the level of 0.6665 (with the appropriate indicators signals) with the target at 0.6740 and stop-loss at 0.6630. Validity – 1-3 days.
Short positions can be opened after the breakdown of the level of 0.6610 with targets at 0.6540, 0.6500 and stop-loss at 0.6640. Validity – 2-3 days.