NZD/USD Forex Technical Analysis – Failure to Hold .6819 Will Produce Another Whipsaw Trading Session
The New Zealand Dollar is edging higher early Thursday as more countries looked for ways to safeguard economic activity through the Omicron surge, while trading volume remained light with the end of the year rapidly approaching.
At 05:53 GMT, the NZD/USD is trading .6833, up 0.0006 or +0.08%.
Volatility was the theme on Wednesday as “risk-off” sentiment drove the Kiwi lower early in the session. Conditions changed later in the say as sentiment shifted to “risk-on”. This triggered a whipsaw move in the NZD/USD which drove the Forex pair into its highest level since December 1.
The rally stalled, however, when U.S 10-year Treasury notes rose to their highest level since December 10.
Due to the extremely low pre-holiday volume, we can’t get a good read on what traders are thinking. We do have to conclude, however, that we probably wouldn’t see this kind of trading action if the major players – banks and institutions – were in the game.
Daily Swing Chart Technical Analysis
The main trend is up according to the daily swing chart. A trade through .6849 will signal a resumption of the uptrend. A move through .6789 will change the main trend to down.
The minor range is .6789 to .6849. Its 50% level or pivot at .6819 is support.
The short-term range is .6868 to .6702. Its 50% level at .6785 is additional support.
Another minor range is .6702 to .6849. Its retracement zone at .6755 to .6758 is a value area.
On the upside, the nearest resistance is a pivot at .6878. This is also the trigger point for an acceleration to the upside.
Daily Swing Chart Technical Forecast
The direction of the NZD/USD on Thursday is likely to be determined by trader reaction to .6819.
A sustained move over .6819 will indicate the presence of buyers. If this creates enough upside momentum then look for a surge into .6849.
Overcoming .6849 will indicate the buying is getting stronger with the next target area .6868 – .6878.
A sustained move under .6819 will signal the presence of sellers. This could trigger a plunge into .6789 – .6785. The latter is a potential trigger point for an acceleration into .6758.