Kiwi rises; Swissie falters as we start important week

Daily Winners and Losers

The New Zealand Dollar tops the performance chart an hour into North American trade, with the kiwi advancing more than 0.9% against the greenback. As equity markets get a reprieve from the heavy selling pressure seen in recent days, the kiwi has found itself outperforming the majors as traders go back on the hunt for yields. The NZD/USD pair held above the 23.6% Fibonacci extensions taken from the June 16 and Aug. 8 troughs at 0.8160. Interim support for the pair rests at the 0.8230 with subsequent floors seen at the 0.82-figure and 0.8160. Topside resistance is seen at the 38.2% extension at 0.8285 with a breach eyeing targets at 0.8340 and just below the 50% extension at 0.8380.

Key Levels/Indicators for NZD/USD

Level/Indicator

Level

50-Day SMA

0.8111

20-Day SMA

0.7763

10-Day SMA

0.7685

2011 CHF High

0.7078

The Swiss franc is the worst performer early in the session, sliding nearly 0.5% against the dollar as investors jettisoned the lower yielding majors like the dollar, the yen, and the swissie. The USD/CHF pair has continued to trade between the 61.8% and 76.4% Fibonacci retracement taken from the July 19 descent at 0.7820 and the 0.80-figure respectively as it consolidates within a wedge formation. Concerns over a possible Swiss-euro peg have all but dissipated after SNB Vice President Thomas Jordan shocked investors with the threat nearly two weeks ago. And with investor appetite picking up early in the week, the pair is likely to remain well supported so far as broader market sentiment remains on the rebound. A clear breach above the 0.7880 level eyes topside targets at 0.7960 and the 76.4% Fib retracement at 0.7990. Interim support holds at 0.7820, with subsequent floors seen lower at 0.7770, 0.7730, and the 50% retracement at 0.7675. With the United States light on economic data this week, traders will be eyeing prints out of Switzerland with trade balance figures on tap overnight.

Key Levels/Indicators USD/CHF

Level/Indicator

Level

50-Day SMA

0.8348

20-Day SMA

0.8460

10-Day SMA

0.8283

2011 NZD High

0.8842

Michael Boutros, Currency Analyst for DailyFX.com is a Technical/Fundamental Analyst specializing in the FX markets. E-mail: mboutros@fxcm.com.

Twitter: @MBForex
WEB: www.fxcm.com

About the Author
Michael Boutros Michael Boutros, Currency Analyst for DailyFX.com is a Technical/Fundamental Analyst specializing in the FX markets. E-mail: mboutros@fxcm.com.
Comments
comments powered by Disqus
Check out Futures Magazine - Polls on LockerDome on LockerDome