NzdUsd maintains its bearish sentiment from February 2009, when it reached a top of 0.8210. From that point, there has been a downtrend that, in 5 waves, has scored the first min at 0.5200 in November 2008, after a drop of almost 37%.

Soon afterwards, there was a Kiwi reaction that stopped at 0.6068, under the 0.6128 that represents the bear market max of the fourth wave. The most interesting point is the next bearish movement, still in 5 waves so that it confirms a bear market is setting out again.

The 0.4964 min was readjusted at 0.4902 on the 4th March 2009, but we think that this is the result of an expanded flat that at 0.5974, probably completed the second wave with a 200 days moving average to form a dynamic resistance. The bearish theory persists, at least until the resistance of 0.6128 is breached, with 0.6350 (38.2% of retracement for the whole bear market) as the next resistance.

In case there will be new downtrends in the next weeks, as we predict, the first target for the third wave will be represented by 0.4808, a level where this third movement will be equal in wideness to the first wave. Instead, the 17th June will represent a first possible bottom date, as the number of descending days here in the third wave will be equal to 1.618 in wave 1 (32). In the event the third wave is extended, then we can expect a fall at least until 0.4087, a level that we have not seen since 2001.

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