NZD/USD forecast for the week of September 25, 2017, Technical Analysis

The New Zealand dollar initially fell during the week but found enough support at the 38.2% Fibonacci retracement level to turn around and start going higher. I believe that the market should continue to see buyers jump in, if we can continue the “risk on” trade overall. The 0.75 level above is the initial target, but eventually if we can break above there, I think we can go as high as 0.80 over the longer term.

Pullbacks of this point should be buying opportunities, as the 50% Fibonacci retracement level offered so much support for the hammer from the previous week. I think that although it will be choppy, the longer-term pressure is probably to the upside, and certainly the easier path seems to be to the upside. It’s not until we break down below the 0.71 level that I would consider selling, at that point should send this market to the 0.68 handle after that. Ultimately, the New Zealand dollar is highly correlated to the commodity markets and of course Asia itself, so keep that in mind. I think we are trying to build up enough pressure to finally break out to an outside move that should take as much higher, but in the meantime, it’s probably can be easier to trade this currency pair from the shorter-term perspective as it may take several attempts to finally clear the 0.75 level. Ultimately, this is a market that should continue to be very noisy and difficult, but ultimately should favor the buyers as the US dollar, although strengthening as of the last couple of sessions, continues to offer less in the way of interest, and therefore the interest rate differential still favors a move to the upside over the longer term.

NZD/USD Video 25.9.17