The 50 SMA Turns Into Support for NZD/USD Indeed, As We Predicted Yesterday
Yesterday NZD/USD was slipping lower as the sentiment turned negative during the Asian and European sessions. Chinese officials said that they want a narrower trade deal, but that might leave out some key issues for the US, which makes the deal even more difficult.
Those comments hurt the sentiment a little and rick assets such as commodity Dollars were getting hammered. But I predicted that the 50 SMA (yellow) would turn into support for this pair. This moving average has been providing solid resistance when the trend was down, so it was bound to turn into support at the first attempt from above, which it did, as shown by the H4 chart above.
The main trend is still down for NZD/USD, but this pair is in a middle of a retrace higher, just like at the beginning of September. Some traders were arguing yesterday that the retrace was over for NZD/USD, but the price bounced off the 50 SMA, so the retrace is not over yet, not until the price moves below the 50 SMA.
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