NZD/USD Sellers Targeting .6876 – .6874 Support Cluster

The New Zealand Dollar is edging lower on Friday as market participants awaited the latest reading on U.S. jobs. Lower oil prices also weighed on the risk-sensitive currency.

Economists predict Friday’s Labor Department report, due to be released at 12:30 GMT, will show that close to half a million U.S. jobs were added last month, with the unemployment rate ticking lower while wage growth accelerated.

Traders expect the March U.S. Non-Farm Payrolls report to show the economy added 492K new jobs last month. The Unemployment Rate is expected to dip to 3.7% from 3.8% and Average Hourly Earnings are expected to have risen by 0.4%.

At 06:05 GMT, the NZD/USD is trading .6917, down 0.0016 or -0.22%.

Also helping to put a cap on the commodity-sensitive New Zealand Dollar is technical resistance and a plunge in crude oil prices.

Oil prices are trading lower on Friday ahead of a meeting of consuming nations to discuss a new release of emergency oil reserves alongside a huge planned release by the United States. The planned U.S. release caused crude oil prices to decline sharply on Thursday.

Daily Swing Chart Technical Analysis

The main trend is up according to the daily swing chart. A trade through .6876 will change the main trend to down. A move through .6999 will signal a resumption of the uptrend.

The NZD/USD is currently trading inside a long-term retracement zone at .6874 to .6955. Inside this zone is a minor pivot at .6938. The Forex pair is currently trading on the weak side of this pivot, making it resistance.

The main range is .6529 to .6999. If the main trend changes to down then its retracement zone at .6764 to .6708 will become the primary downside target.

Daily Swing Chart Technical Forecast

The direction of the NZD/USD on Friday is likely to be determined by trader reaction to .6938.

Bearish Scenario

A sustained move under .6937 will indicate the presence of sellers. If this move is able to generate enough downside momentum then look for the selling to possibly extend into the support cluster at .6876 – .6874. The latter is a potential trigger point for an acceleration to the downside with .6764 – .6708 the next major downside target.

Bullish Scenario

A sustained move over .6738 will signal the presence of buyers. The first target is the major Fibonacci level at .6955.

Overcoming .6955 will indicate the buying is getting stronger with the main top at .6999 the next target. This is a potential trigger point for an acceleration into a pair of November 2021 main tops at .7053 and .7081.