GBP/NZD traded higher today, after it hit support near the 1.9485 zone during the Asian morning. It then moved above the 1.9605 level, and it now looks to be heading towards the 1.9730 zone. Overall, the pair continues to trade above the upside support line drawn from the low of July 30th and thus, we would consider the near-term outlook to be positive for now.
If the bulls are strong enough to reach and breach the 1.9730 zone, then we may see them aiming for the 1.9825 barrier, marked by the high of September 24th. The rate could stall there for a while, or even correct somewhat lower, but as long as it stays above the pre-mentioned upside line, we would still see decent chances for another leg north. If the forthcoming positive leg brings the pair above 1.9825, then the bulls may get encouraged to push towards the psychological round figure of 2.0000. That zone was tested on September 20th, while on May 8th, the rate was rejected fractionally above it before entering a steep downtrend mode.
Shifting attention to our short-term oscillators, we see that the RSI just poked its nose above 50, while the MACD, although negative, lies above its trigger line and looks to be heading towards zero. These indicators suggest that the rate may start picking up upside momentum soon, and they corroborate our view for some further advances in the short run.
On the downside, we would like to see a dip below 1.9370, a territory which provided strong resistance between August 28th and September 5th, before we abandon the bullish case. Such a move would confirm a break below the upside support line drawn from the low of July 30th, and would also bring the rate below the 200-EMA. The bears could initially aim for the 1.9285 zone, the break of which could carry larger bearish implications, perhaps paving the way towards the low of September 12th, at around 1.9120.
