NZD/USD Forex Technical Analysis – Support Zone at .6548 – .6509 Controlling Near-Term Direction

The New Zealand Dollar is inching lower on Thursday, after a steep plunge the previous session. The Kiwi was trading higher most of the session on Wednesday before a reaction to the Fed minutes knocked the wind out of the move.

The U.S. Dollar surged against the New Zealand Dollar after minutes from last month’s U.S. Federal Reserve meeting gave few clues about whether central bank policymakers would make more dovish shifts in its monetary policy framework, perhaps as early as the next meeting on September 18.

At 06:20 GMT, the NZD/USD is trading .6555, down 0.0002 or -0.03%.

Daily Swing Chart Technical Forecast

The main trend is down according to the daily swing chart. A trade through .6520 will reaffirm the downtrend. The main trend will change to up on a move through .6691.

The minor trend is up. Taking out .6651 will reaffirm the minor trend. The minor trend will change to down on a move through .6520.

The main range is .6381 to .6716. Its retracement zone at .6548 to .6509 is support. It is also controlling the near-term direction of the Forex pair. The NZD/USD is currently testing the upper or 50% level of this range.

The short-term range is .6716 to .6520. Its retracement zone at .6618 to .6641 is resistance. This zone essentially stopped the rally at .6651 on Wednesday.

Daily Swing Chart Technical Forecast

Based on the early price action and the current price at .6555, the direction of the NZD/USD on Thursday is likely to be determined by trader reaction to the main 50% level at .6548.

Bullish Scenario

A sustained move over .6548 will indicate the presence of buyers. If this move is able to generate enough upside momentum then we could see a retest of at least .6618.

Bullish Scenario

A sustained move under .6548 will signal the presence of sellers. If this creates enough downside momentum then look for the selling to possibly extend into the main bottom at .6520, followed by the main Fibonacci level at .6509 and another main bottom at .6503.

The main bottom at .6503 is a potential trigger point for an acceleration to the downside.

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