NZD/USD Forecast August 11, 2017, Technical Analysis

The New Zealand dollar has fallen significantly during the day on Thursday, breaching the 0.73 handle. This is a market that has been dropping a bit at a time for several sessions, I think we will continue to do so. Short-term rallies are probably going to show signs of exhaustion that you can start selling, and that is my plan, simply selling rallies that show signs of exhaustion. I think that the market will go looking towards the 0.70 level underneath, which was a major resistance barrier in the past. I think there will be plenty of psychological and structural support in that area, and therefore that would be my target. I don’t have any interest in buying this market until we break above the 0.7375 handle, something that doesn’t look very likely to happen.

Volatility

I believe that the volatility should continue to be a major influence on the market, as we see the markets show signs of concern in general. Geopolitical risks, US dollar strength, and of course risk aversion will drive this market much lower. Ultimately, I think that once we get to the 0.70 level, it’s likely that we could see some type of rebound from that level. In the meantime, I suspect that this market will continue to drop significantly. It’s not until we break above the 0.75 handle that I could see this market being more of a “buy-and-hold” situation, and until that happens it’s very likely that we will continue to see quite a bit of choppiness, so therefore unless you can deal with some type of volatility in your account, this may not be the market for you to trade. Remember, massive influences put into this market due to what happens in commodities. The New Zealand dollar is highly sensitive to a basket of commodities.

NZD/USD Video 11.8.17