USD: Techs Point To A USD/CAD Rally And A NZD/USD Decline – BofAML

Bank of America Merrill Lynch Technical FX Strategy Research argues the current price action points to bullish USD/CAD and bearish NZD/USD setups.

“The decline in USD/CAD held just above the supportive 200week SMA. It also formed a base near the May 2016 low. The decline is oversold according to RSI. Oversold conditions actually reached some of the deepest on record since 2007. Net long CAD positioning is stretched long and could be vulnerable to a reversal. Above this support, we see a corrective technical rally under way and prefer to buy spot.

NZD/USD RSI momentum peaked into a false price break above the 200-week SMA and near the 50% Fibonacci retracement. A TD Setupsell signal also warned a correction was due. With positioning stretched on both accounts and seasonals in favor of a decline, BofAML argues. 

In line with this view, BofAML is long USD/CAD* in spot and short NZD/USD via a put spread.

Source: Bank of America Merrill Lynch Rates and Currencies Research

The article is published by one of the foremost sources of Forex trading information. Link to the original article above.

from eFXNews http://feedproxy.google.com/~r/Efxnews/~3/DrC3HSJFLpw/usd-techs-point-usdcad-rally-and-nzdusd-decline-bofaml

from Online Forex Trading Resource
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