NZD/USD Forex Technical Analysis – March 29, 2019 Forecast

The New Zealand Dollar is edging higher on Friday after an attempt to breakout to the downside failed to draw in enough sellers to continue the move. The lack of selling pressure may have spooked a few of the weaker shorts, encouraging them to cover their previously established positions.

Earlier in the session, Reserve Bank of New Zealand governor David Orr said this week’s shift to a more dovish wasn’t his “last swing at the bat” as the sole decision maker but rather is the starting point of the new committee that will take over the reins on April 1.

At 05:18 GMT, the NZD/USD is trading .6792, up 0.0017 or +0.25%.

Daily Swing Chart Technical Analysis

The main trend is up according to the daily swing chart, however, momentum shifted to the downside when the Forex pair formed a closing price reversal top at .6939 on March 21. A trade through .6744 will change the main trend to down. A move through .6939 will signal a resumption of the uptrend.

The minor trend is down. This confirms the shift in momentum.

The direction of the NZD/USD after Wednesday’s steep sell-off is being controlled by a pair of retracement zones.

The main range is .6970 to .6591. Its retracement zone at .6780 to .6852 is currently being tested. The longer-term direction of the NZD/USD is being controlled by this zone.

The minor range is .6591 to .6843. Its retracement zone at .6767 to .6725 is support. It stopped the selling pressure recently at .6744 on March 7. If this zone fails then look for the start of a steep sell-off.

Daily Swing Chart Technical Forecast

Based on the early price action, the direction of the NZD/USD on Friday is likely to be determined by trader reaction to the main 50% level at .6780.

Bullish Scenario

A sustained move over .6780 will indicate the presence of buyers. If this creates enough upside momentum then look for a possible spike into the main Fibonacci level at .6825. This is a potential trigger point for an acceleration to the upside.

Bearish Scenario

A sustained move under .6780 will signal the presence of sellers. The first downside target is the minor 50% level at .6767. Since the main trend is up, buyers are likely to come in on a test of this level.

The 50% level at .6767 is also a trigger point for an acceleration to the downside with the next target the main bottom at .6744. Taking out this bottom will change the main trend to down. This could trigger a further decline into the minor Fibonacci level at .6725, followed by a pair of bottoms at .6719 and .6706.