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The New Zealand Dollar (NZD) extended upside movement against the US Dollar (USD) on Wednesday, increasing the price of NZDUSD to more than 0.6860 ahead of some key economic events. The technical bias remains bearish due to a Lower Low and Lower Higher in the recent wave on hourly chart.
Technical Analysis
As of this writing, the pair is being traded around 0.6864. A hurdle may be noted near 0.6871, the 50% fib level ahead of 0.6885, the 38.2% fib level and then 0.6902, the 23.6% fib level as demonstrated in the following chart.
On the downside, the pair is expected to find a support around 0.6858, the 61.8% fib level ahead of 0.6841, the 76.4% fib level and then 0.6814, the swing low of the last major dip. The technical bias will remain bearish as long as the 0.6900 resistance area is intact.
US Growth
The US Bureau of Economic Analysis is due to release the US Gross Domestic Product (GDP) report today during the early New York session. According to the average forecast of different economists, the GDP of the World’s largest economy remained -0.2% in the first quarter as compared to -0.7% in the same quarter of the year before. Generally speaking, higher GDP reading is considered positive for the economy thus a better than expected actual outcome will be seen as bearish for NZDUSD and vice versa.
Trade Idea
Considering the overall technical and fundamental outlook, buying the pair around current levels appears to be a good strategy if we get a bullish pin bar or bullish engulfing candle on four-hour or daily chart.
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