RBNZ announced a surprising rate cut on NZDUSD taking the OCR from 3.50 % to 3.25 %. It was unexpected and NZDUSD was instantly sold. Adding to the cut we could also spot a comment from RBNZ Governor Graeme Wheeler that NZD has more room to go down.
Technically the pair could show some retracement to 0.7080-0.7100 – confluence point (POC). We can see historical buyers (now moment sellers), L5, 38.2, inner trend line, june trendline all forming a resistance area that could be used for shorting. However if the MOMENTUM persists and we dont get a retracement ( aka loss of momentum) we might see a DIRECT DROP below 0.6997 to 0.6950- August 2010 low. That should be the next target with or without retracement to the POC. So pay attention to 0.6997 break or a bounce to confluence zone.
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