NZD/USD recovers daily loses
The general direction of the New Zealand Dollar during the previous session was tended south.
Apart from a brief test of the 200-hour SMA mid-day, the Kiwi was trading along the lower boundary of a one-week descending channel. Technical indicators suggest that the same bearish sentiment is likely to prevail during this session and even beyond. Given that the pair is facing the combined resistance of the monthly and weekly PPs and the 55-hour SMA circa 0.6860, this is the most likely scenario.
The nearest southern barrier in this case is the weekly S1 at 0.6810.
Nevertheless, it is also possible that bulls do not give in their positions so easily—a move that could result in a minor consolidation period between 0.6860 and 0.6830.
Apart from a brief test of the 200-hour SMA mid-day, the Kiwi was trading along the lower boundary of a one-week descending channel. Technical indicators suggest that the same bearish sentiment is likely to prevail during this session and even beyond. Given that the pair is facing the combined resistance of the monthly and weekly PPs and the 55-hour SMA circa 0.6860, this is the most likely scenario.
The nearest southern barrier in this case is the weekly S1 at 0.6810.
Nevertheless, it is also possible that bulls do not give in their positions so easily—a move that could result in a minor consolidation period between 0.6860 and 0.6830.
Comment:
NZD/USD was trading between the 100-hour SMA and the bottom boundary of a short-term ascending channel on Monday. This movement sideways was disrupted by a surge in the wake of the RNBZ Governor’s comments about modifications to the country’s monetary policy early in this session. The Kiwi dashed through the 200-hour SMA and the weekly PP and remained above both marks.
Technical indicators flash strongly bearish signals. The nearest support area that could hinder this fall is the monthly PP, the 55– and 100-hour SMAs at 0.6864. This mark is likewise reinforced by the lower boundary of the aforementioned short-term channel.
In case bulls manage to take the upper hand, possible points of delay is a channel border and the weekly and monthly R1s circa 0.6950.
NZD/USD was trading between the 100-hour SMA and the bottom boundary of a short-term ascending channel on Monday. This movement sideways was disrupted by a surge in the wake of the RNBZ Governor’s comments about modifications to the country’s monetary policy early in this session. The Kiwi dashed through the 200-hour SMA and the weekly PP and remained above both marks.
Technical indicators flash strongly bearish signals. The nearest support area that could hinder this fall is the monthly PP, the 55– and 100-hour SMAs at 0.6864. This mark is likewise reinforced by the lower boundary of the aforementioned short-term channel.
In case bulls manage to take the upper hand, possible points of delay is a channel border and the weekly and monthly R1s circa 0.6950.
Comment:
For most of its session on Tuesday, the New Zealand Dollar was moving along the upper boundary of a breached descending channel. Its trading range narrowed significantly later in the evening when pressure of the 55– and 200-hour SMAs squeezed the Kiwi between their bounds. The pair eventually broke out and tested this week’s high of 0.6909.
It is likely that the rate tries to edge lower one more time during the evening. However, it faces a significant support cluster set by the 55-, 100– and 200-hour SMAs, the weekly and monthly PPs. One of these levels should work as an unbreakable barrier that allowed bulls to take the upper hand.
The nearest resistance is the distant monthly and weekly R1s at 0.6948. The Kiwi, however, is unlikely to push this high.
For most of its session on Tuesday, the New Zealand Dollar was moving along the upper boundary of a breached descending channel. Its trading range narrowed significantly later in the evening when pressure of the 55– and 200-hour SMAs squeezed the Kiwi between their bounds. The pair eventually broke out and tested this week’s high of 0.6909.
It is likely that the rate tries to edge lower one more time during the evening. However, it faces a significant support cluster set by the 55-, 100– and 200-hour SMAs, the weekly and monthly PPs. One of these levels should work as an unbreakable barrier that allowed bulls to take the upper hand.
The nearest resistance is the distant monthly and weekly R1s at 0.6948. The Kiwi, however, is unlikely to push this high.
Comment:
Starting from early Wednesday, the bearish sentiment prevailed in the market and sent the New Zealand Dollar for a significant decline.
Not even the combined support of the 55-, 200– and 100-hour SMAs and the weekly and monthly PPs circa 0.6870 could hinder this fall for long. By mid-Thursday, the pair had already reached the weekly S1 and the bottom boundary of a four-week ascending channel.
This move sent technical indicators in the strongly bearish area. Even though some further decline is still possible for a couple of hours, the Kiwi should try appreciating against the US Dollar.
The upside target for the following 24 hours could be the aforementioned 0.6870 area.
Starting from early Wednesday, the bearish sentiment prevailed in the market and sent the New Zealand Dollar for a significant decline.
Not even the combined support of the 55-, 200– and 100-hour SMAs and the weekly and monthly PPs circa 0.6870 could hinder this fall for long. By mid-Thursday, the pair had already reached the weekly S1 and the bottom boundary of a four-week ascending channel.
This move sent technical indicators in the strongly bearish area. Even though some further decline is still possible for a couple of hours, the Kiwi should try appreciating against the US Dollar.
The upside target for the following 24 hours could be the aforementioned 0.6870 area.
Comment:
The New Zealand Dollar was weakening against the Greenback for two trading session. This fall, however, was stopped by the weekly S1 at 0.6821 and the lower boundary of a four-week channel.
Upside risks prevailed mid-session when worse-than-expected US labour data put downward pressure on the US Dollar. The given surge was not significant, as the monthly PP and the 100-hour SMA disrupted any intentions to edge above the 0.6865 mark.
It is unlikely that this area is surpassed in this session; thus, the most probable direction for the pair is south.
As apparent on the chart, the nearest support is the distant weekly S1. This area might be reached, but a breakout is not expected.
The New Zealand Dollar was weakening against the Greenback for two trading session. This fall, however, was stopped by the weekly S1 at 0.6821 and the lower boundary of a four-week channel.
Upside risks prevailed mid-session when worse-than-expected US labour data put downward pressure on the US Dollar. The given surge was not significant, as the monthly PP and the 100-hour SMA disrupted any intentions to edge above the 0.6865 mark.
It is unlikely that this area is surpassed in this session; thus, the most probable direction for the pair is south.
As apparent on the chart, the nearest support is the distant weekly S1. This area might be reached, but a breakout is not expected.
After testing the 0.6820 mark early on Friday, the prevailing upside risks pushed the New Zealand Dollar for a 78-pip appreciation against the US Dollar. This positioning did not hold for long, as the rate began trading between the 200-, 100– and 55-hour SMAs during most of today’s session.
In general, the dominant pattern remains the three-week ascending channel. As apparent on the chart, the bottom boundary of this formation was not yet reached. This suggests that the Kiwi might still weaken against its American counterpart, setting the 0.6830 mark as a near-term target for this week.
This scenario is the most likely option, as the combined resistance of the 100– and 200-hour SMAs and the weekly PP circa 0.6880 could introduce some changes to the pair’s movement upwards.