Yahoo Finance NZD/USD Forecast October 20, 2017, Technical Analysis
The New Zealand dollar has crashed during the Thursday session after results of the election went wrong for currency traders. I believe that the 0.70 level underneath is starting offer support though, so I think that you could take a long position in this market as it reverts to the mean, with a relatively tight stop. Every once in a while, the market will present an overreaction like this, and that could be what we are seeing. Needless to say, if we were to break down below the 0.70 level with any type of significance, then that of course is negative. It’s a large, round, psychologically important number, and an area that has been structurally important in the past as well. Because of this, I think that the astute currency trader may be able to make a significant amount of money. If we do break down though, then there is even more support at the 0.68 level underneath.
This isn’t to say that if we rally is going to be easy, and quite frankly the volatility could be nauseating. However, another thing that you should pay attention to is that the New Zealand dollar is highly sensitive to commodity markets, so let’s hope they do well simultaneously. If they do, then we should do reasonably well with this trade. But with the ability to play such a tight stop loss, that should help you in the longer-term, as you are essentially “paying for information.” We will have to see what happens next, but the US dollar falling would also be a help, so pay attention to the US Dollar Index. Ultimately, this market continues to be volatile in my estimation, but we have gotten oversold rather quickly, and as a result I think there may be a short-term opportunity here.
NZD/USD Video 20.10.17
This article was originally posted on FX Empire
