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NZD/USD Reaction to .6607 – .6588 Sets Tone Early Monday

By:
James Hyerczyk
Updated: Feb 6, 2022, 21:24 UTC

Look for an upside bias on a sustained move over .6607. A sustained move under .6588 will signal the presence of sellers.

NZD/USD

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The New Zealand Dollar finished lower on Friday in a volatile trade after data showed the world’s largest economy created far more jobs than expected, raising the chances of a larger Federal Reserve interest rate increase at the March policy meeting.

On Friday, the NZD/USD settled at .6614, down 0.0050 or -0.75%.

Data showed U.S. Non-Farm Payrolls grew 467,000 jobs last month. Data for December was revised higher to show 510,000 jobs created instead of the previously reported 199,000. Economist polled by Reuters had forecast 150,000 jobs added in January. Estimates ranged from a decrease of 400,000 to a gain of 385,000 jobs.

The focus for traders now shifts to next Friday’s major U.S. consumer inflation report then to the Reserve Bank of New Zealand’s monetary policy and interest rate decisions the week-ending February 26.

Daily NZD/USD

Daily Swing Chart Technical Analysis

The main trend is down according to the daily swing chart. A trade through .6529 will signal a resumption of the downtrend. A move through .6891 will change the main trend to up.

The minor trend is down. A trade through .6684 will change the minor trend to up. This will shift momentum to the upside.

The first minor range is .6529 to .6684. Its support zone comes in at .6606 to .6588.

The second minor range is .6811 to .6529. Its 50% level at .6670 is resistance.

The short-term range is .6891 to .6529. Its retracement zone at .6710 to .6753 is resistance.

On the downside, the major support is a long-term 50% level at .6467.

Short-Term Outlook

Friday’s price action suggests the early direction of the NZD/USD on Monday will be determined by trader reaction to .6607 and .6588.

Look for an upside bias on a sustained move over .6607 with .6670 to .6684 the first upside target.

A sustained move under .6588 will signal the presence of sellers. If the selling is strong enough then this could trigger an acceleration to the downside with .6529 the next target.

For a look at all of today’s economic events, check out our economic calendar.

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.

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