FX.co ★ NZD/USD: Technical Analysis and Trading Recommendations for January 20, 2012.

Strong Support: 0.7720.

Strong Resistance: 0.8280.

Trading Recommendations:

According to previous events, the price will be trapped between 0.79 and 0.81.

• Buy above 0.7935 with the first target of 0.81, it might resume to 0.8155 and then to 0.82.
  
• Below 0.8265 look for further downside with 0.81 and 0.8060 targets.
  
• Also it should be noted that if there happens a break through 0.79, the market will indicate bearish mood towards 0.7720.

Overview:

NZD/USD movement will be continued straight from 0.7933 (at H4 chart 38.2% of Fibonacci retracement levels), therefore the Kiwi is showing signs of strength, following the break of the highest level of 0.7933, so it will be a good sign to buy above the level of 38.2% of Fibonacci retracement levels on H4 chart with the first target of 0.80, and further to 0.8108 (it will act as a strong resistance for that it is going to be a good place to take profit, it also should be noted that this level of taking profit will coincide with 50% of Fibonacci). However, in case if a reversal takes place and NZD/USD breaks through the support level of 0.79, then the market will lead to further decline to 0.7720, indicating bearish market.