After topping in the end of December near the 0.8800 level, NZD/CAD drifted lower, but after the first week of January, the pair started moving sideways, forming a range. The range is roughly between the 0.8615 and 0.8680 levels. At the same time, the rate continues to move around its 200 EMA on the 4-hour chart. For now, we will take a neutral stance and wait until we see a break of one of the range’s sides, before examining a further directional move.
If the rate rebounds from the 200 EMA and breaks above the 0.8860 barrier, this might attract more buyers, as it could increase the pair’s chances of moving further north. This way, we will aim for the 0.8713 hurdle, marked by an intraday swing high of January 2nd, a break of which may lead NZD/CAD even higher. If so, we will then aim for the 0.8760 level, which marks the inside swing low of December 30th.
Our oscillators, the RSI and the MACD, are currently more on the flat side. The RSI keeps on balancing near 50 and the MACD cannot get away from the zero line. Such activity reflects the current neutrality in the pair.
Alternatively, if the pair breaks the lower bound of the aforementioned range, at 0.8615, this might clear the path for a further slide. We will then aim for the 0.8583 obstacle, which if broken might send the rate to the 0.8555 zone, marked near the highs of November 26th and 29th. NZD/CAD could initially stall around there, but if the selling continues, this may lead to a break of that zone and a drop to the 0.8516 level, marked near the lows of November 28th and 29th.
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