Advertisement
Advertisement

NZD/USD Forex Technical Analysis – Inside Weekly Up Channel; Strengthens Over .6884, Weakens Under .6812

By:
James Hyerczyk
Published: Mar 18, 2019, 00:59 UTC

Based on last week’s close at .6846 and the two-sided price action, the direction of the NZD/USD this week is likely to be determined by trader reaction to the short-term pivot at .6831.

New Zealand Dollars

The New Zealand Dollar posted a higher close against the U.S. Dollar last week mostly in response to falling U.S. Treasury yields. So-so U.S. inflation data combined with weaker-than-expected U.S. manufacturing data helped drive down demand for the U.S. Dollar. The news strongly suggests that traders are expecting the U.S. Federal Reserve to continue its cautious approach to future rate hikes.

Last week, the NZD/USD settled at .6846, up 0.0043 or +0.63%.

Look for a bullish tone this week if the Federal Open Market Committee’s economic projections come in more dovish than expected. Some say the Fed may suggest that it does not expect to raise rates at all in 2019. This would be especially bullish for the NZD/USD.

NZD/USD
Weekly NZD/USD

Weekly Technical Analysis

The main trend is up according to the weekly swing chart, however, momentum is trending lower. A trade through .6943 will signal a resumption of the uptrend. The main trend will change to down on a trade through .6719.

The minor trend is also up. A move through .6744 will change the minor trend to down. This will further support the shift in momentum to down. Furthermore, the series of lower tops is also indicating the presence of sellers. Taking out the recent minor bottom at .6744 and the main bottom at .6719 will signal that the selling pressure is getting stronger.

The main range is .6424 to .6970. Its retracement zone at .6697 to .6633 is support. This zone is controlling the longer-term direction of the NZD/USD.

The short-term range is .6943 to .6719. Its 50% level or pivot at .6831 is controlling the near-term direction of the NZD/USD. This price acted like support and resistance last week.

Weekly Technical Forecast

Based on last week’s close at .6846 and the two-sided price action, the direction of the NZD/USD this week is likely to be determined by trader reaction to the short-term pivot at .6831.

Bullish Scenario

A sustained move over .6846 will indicate the presence of buyers. The first upside target is an uptrending Gann angle at .6884. Overtaking this angle will indicate the buying is getting stronger. This could lead to a test of the minor top at .6903. Taking out this level could trigger a move into the main top at .6943, followed closely by the next main top at .6970.

Bearish Scenario

A sustained move under .6846 will signal the presence of sellers. The first downside target is an uptrending Gann angle at .6812. This angle is the trigger point for an acceleration to the downside with the next targets the minor bottom at .6744 and the main bottom at .6719.

Under .6719 is a Gann angle/50% level support cluster at .6702 to .6697.

The NZD/USD begins the week inside an uptrending channel bounded by .6884 and .6812. Traders are waiting for the Fed’s interest rate and monetary policy decisions to trigger the next move. These levels are this week’s breakout levels.

About the Author

James is a Florida-based technical analyst, market researcher, educator and trader with 35+ years of experience. He is an expert in the area of patterns, price and time analysis as it applies to futures, Forex, and stocks.

Did you find this article useful?

Advertisement