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19 Feb 2013
Forex Flash: NZD/USD has potential for 0.8575; corrective turn not discarded - JPMorgan
NZD extended through a number of key levels over the past week suggesting this bullish setup is likely to persist, notes Nial O'Connor, currency strategist at JPMorgan. The comments follow last week's FXstreet.com observations in which it was noted that the break of 0.85 may allow prospects for 0.8560/70.
The JPMorgan strategist sees "potential for additional strength initially into the .8575 area and near the August ’11 peak", yet Mr. O'Connor highlights "there are several bearish concerns that are worth monitoring for a potential turn" he says.
He adds: "Lack of confirmation of these new highs is the reason the current trend is viewed as unsustainable and vulnerable to a corrective phase. Initial support levels take on added importance with the .8330/.8280 zone - uptrendline from the June ’12 low and the early-February/late-January lows -. Violations should confirm at least a short term top, if not a deeper pullback."
The JPMorgan strategist sees "potential for additional strength initially into the .8575 area and near the August ’11 peak", yet Mr. O'Connor highlights "there are several bearish concerns that are worth monitoring for a potential turn" he says.
He adds: "Lack of confirmation of these new highs is the reason the current trend is viewed as unsustainable and vulnerable to a corrective phase. Initial support levels take on added importance with the .8330/.8280 zone - uptrendline from the June ’12 low and the early-February/late-January lows -. Violations should confirm at least a short term top, if not a deeper pullback."