NZD/USD which was the biggest gainer against greenback last week, on Monday pulled back from an important 61.8% fib level, retracing more than 30 pips of recent gain.

Major Support & Resistance Levels

At the moment in Asian session, the pair is hovering around 0.8291 where it is likely to find an immediate support at 0.8256 (200 MA on 4 hour chart), ahead of 0.8227 (100 MA on 4 hour chart) and then 0.8176-0.8195 support area, a beak and close below this level may trigger further losses up to 0.8121 and 0.8082 that are 200 DMA and 38.2% fib levels respectively.

On upside, immediate resistance is seen around 0.8320 (daily high + 61.8%fib level), and then 0.8450 (76.4% fib level).

Butterfly pattern

Butterfly pattern is obvious on daily chart as show in following chart which is a good indication of bearish reversal.

Technical Indicators

MACD is bullish with no signs of divergence. Relative Strength Index (RSI) is showing neutral to bullish readings on various timeframes. Bollinger bands are showing daily support and resistance at 0.8091 and 0.8373 respectively. 55 DMA is still above 200 DMA which indicates bullish trend in long run.

Fundamental Situation

Reserve Bank of New Zealand (RBNZ) will issue monetary policy statement mentioning benchmark interest rate decision and hold a press conference thereafter on Thursday. Analysts believe that RBNZ will keep interest rate unchanged at 2.5%, however, any surprise may trigger extreme volatility in NZD pairs.

On the other hand, no high profile economic report about the US economy is due this week, however dollar may be seen trading in positive territory amid recent performance of employment sector and better than expected growth in third quarter due to which some analysts believe that Federal Reserve may start winding up its aggressive asset purchase program in a policy meeting which is scheduled on 17-18 December, as it was mentioned in last FOMC minutes. 

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