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NZD/USD at 0.8350 support; will it stop the bears?

FXStreet (Moscow) - NZD/USD is in the free fall as the pair started the day at 0.8373 and attempted to break below 0.8350 support; current Asian low is set at 0.8347.

Ugly duckling of the FX universe

Kiwi is a poor thing as it has been falling down since Monday and has lost more than 100 pips so far. Poor macroeconomic data, namely lower than expected inflation expectations and disappointing results of the latest Global Dairy Trade (GDT) auction forced investors to turn their back to NZD. From the technical point of view, a sustained movement below 0.84 handle is a bearish signal that paves the way towards the initial target of 0.8350/40 followed by a strong support at 0.8320. On the other hand, NZD/USD is deeply oversold on the short-term basis, which hightens the risks of the upside correction. Later during the day the pair could be influnced by USD sentiments as hawkish comments in Jackson Hall could trigger another wave of Dollar buying across the board. Keep and eye at 0.8370 on the upside and 0.8350/40 on the downside.

What price levels and patterns have to be considered?

Current price is 0.8360, with resistance ahead at 0.8361 (Weekly Classic S2), 0.8366 (Yesterday's Low), 0.8374 (Daily Open), 0.8374 (Monthly Low) and 0.8374 (Weekly Low).

Next support to the downside can be found at 0.8348 (Daily Classic S1), 0.8348 (Daily Low), 0.8322 (Daily Classic S2), 0.8314 (Weekly Classic S3) and 0.8278 (Daily Classic S3).

Looking at price patterns, we can see a Dark Cloud Cover and Engulfing Bearish 4-hour candlestick formation.

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