Can GBP-NZD crack 2.0? Outlook and forecast for the British pound versus the New Zealand dollar

Before we try and predict the next moves the pound versus New Zealand dollar exchange rate we note that the pair is currently 0.2 pct down on Tuesday night's closing rate; we see GBP-NZD at 1.9545 at 15:11 in London.

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Forecasting gains above 2 in GBP-NZD

 We note that Trading Central are of the opinion that should the pound versus New Zealand dollar maintain ground north of a pivot point at 1.926 then the possibility of a break above the all-important rate of 2.0 is possible.

Trading Central say:

"1.926 is our pivot point. Our preference: as long as 1.926 is support look for 2.025.

"Alternative scenario: below 1.926, expect 1.889 and 1.867.

"The RSI is above its neutrality area at 50. The MACD is below its signal line and positive. The pair could retrace. Moreover, the pair is trading above both its 20 and 50 MAs (respectively at 1.9236 and 1.8676)."

We would however argue that the short-term possibility of GBP-NZD to break 2.0 is questionable.

Recognia Inc. point out that the 2-6 week charts for the GBP-NZD show 2 bullish events versus 2 bearish events. The problem for the sterling bulls at this stage is that the 2 bearish events have formed in succession after the bullish events.

The most recent technical event was the formation of a bearish     Commodity Channel Index on the 13 Jun 2013 at 1.9415 which suggests to us that short-term bullish momentum has stalled.

However, those opting to take a medium term view (6 weeks to 9 months) would merely see this stalling of upward momentum as a good entry point. The charts are showing 4 bullish events and no bearish events - medium term momentum remains positive.

Outlook for New Zealand dollar against the US dollar

 New Zealand dollar's performance against the US dollar will also dictate direction in GBP-NZD.

ICN Financial Markets tell us they prefer to hold a negative bias on NZD-USD:

"The NZD/USD received solid support at 0.7920 as it withstood against all of the pair's bearish attempts, helping us propose an uptrend. The pair must settle above 0.8065 in order to confirm the uptrend's return; the pair will surge above linear regression indicators and above the Broadening Wedge Pattern (positive setup) main resistance.

"Trading range expected today is between the key support at 0.7800 and the key resistance 0.8135.

"Short-term trend is downside targeting 0.7715 if 0.8400 remains intact."