NZD/USD - What’s next after Friday’s bearish outside day candle?

The bid tone around the US dollar strengthened on Friday following the strong US wage growth data release, pushing the NZD/USD pair down to 0.6954 levels.

Friday’s high/low of 0.7043/0.6954 engulfed the Thursday’s bullish price action. The bearish outside day candle suggests the corrective move from the low of 0.6862 (Dec 23 low) could have run out of steam.

The spot could extend Friday’s losses, especially if the comments from Fed’s Rosengren and Lockhart boost expectation of a steeper rate hike path in 2017.

NZD/USD Technical Levels

At the time of writing, the spot was trading around 0.63865 levels. Moreover, the bird was sitting below the head and shoulder neckline level of 0.6980.

A break above 0.6980 would open the door to 0.70 (zero figure) and 0.7043 (Friday’s high). On the lower side, a failure to hold above 0.6955 (session low) would expose support at 0.69 (zero figure) and 0.6884 (Jan 3 low).