New Zealand Dollar at Potential Reversal Point

[B]Commentary:[/B] We wrote yesterday that “a measured objective for the end of the decline is the 100% extension of .8108-.7553/.7701 at .7146. Continue to favor the downside and test of the mentioned levels.” Kiwi is right at the objective of .7146.

Considering the longer term bullish AUDUSD count (and the fact that the NZDUSD is highly correlated with the AUDUSD), and the idea that Kiwi has broken lower from a triangle (triangle breaks are terminal), we think it highly probable that the pair finds a bottom near current price. However, there is no evidence of a bottom. We will not take action until we see evidence of one. A drop to .6803 (161.8% extension) would strongly indicate that the longer term bullish idea is wrong. We would then look to sell a corrective rally.

[B]Strategy:[/B] Flat