NZD/USD Forex Technical Analysis – Trading Inside Major Retracement Zone at .6825 to .6780
The New Zealand Dollar is trading sharply lower on Thursday. Some of the selling is a continuation of the steep break from the previous session. The initial move was fueled by weaker-than-expected trade data. New Zealand’s January trade balance came in at -914 million NZD versus an expected deficit of -300 million NZD.
At 20:22 GMT, the NZD/USD is trading .6810, down 0.0037 or -0.55%.
Additional selling pressure is being fueled by renewed tensions over U.S.-China trade negotiations and weak Chinese economic data.
Daily Technical Analysis
The main trend is up, but momentum is trending lower due to the formation of the secondary lower top at .6903. A trade through this level will shift momentum to the upside. The main trend will change to down on a trade through .6758.
The major retracement zone at .6780 to .6825 is controlling the longer-term direction of the NZD/USD. The Forex pair is currently trading inside this zone as traders try to form another higher bottom.
The main range is .6592 to .6943. If the selling pressure continues then its retracement zone at .6767 to .6726 will become the primary downside target.
Daily Technical Forecast
Based on the current price at .6810, the direction of the NZD/USD on Friday is likely to be determined by an uptrending Gann angle at .6797.
A sustained move over .6797 will indicate the presence of buyers. If this move is able to generate enough upside momentum then look for the rally to possibly extend into the major Fibonacci level at .6825.
Overtaking .6825 will put the NZD/USD in a position to challenge the uptrending Gann angle at .6849. Overcoming this price will put the Forex pair in a position to extend the rally.
A failure to hold .6797 will signal the presence of sellers. This could lead to a quick break into a support cluster at .6784 to .6780.
If .6780 fails as support then look for the selling to extend into another support cluster at .6767 to .6758.
A move through .6758 will change the main trend to down, but more importantly, it could trigger an acceleration to the downside with the next target zone .6726 to .6719.