The New Zealand dollar rallied during the trading session on Monday, and as the Americans came on board, we continue to see even more strength. The market looks likely to go towards the 0.75 level above, which is the top of the overall consolidation during the previous year, and I think that with the significant bearish pressure in the greenback as of late, it makes sense that we continue to go higher. This will also be heavily influenced by how the commodity markets do, as the New Zealand dollar is so highly sensitive to the overall attitude of commodity traders.
I believe that the pullbacks from here should be nice buying opportunities, less of course we break down below the 0.71 handle, where AC structural support. A breakdown below there opens the door to the 0.70 level, but that seems to be very unlikely. I think that the 0.75 level being broken to the upside is a bit more likely. The US Dollar Index is getting pummeled again, and that of course favors all other currencies around the world, with the New Zealand dollar be a bit thinner of a market than others giving it the opportunity to move quicker.
If we did break down significantly, we would go to the 0.68 handle, but that seems to be very unlikely at this point, something that I rate at about a 15% chance, at best. Buying on the dips is a nice way to build up a large position for what could be a resistance breaking rally.
NZD/USD Video 23.01.18
This article was originally posted on FX Empire
More From FXEMPIRE:
- Tuesday Support and Resistance Levels – January 23, 2018
- USD/JPY Fundamental Daily Forecast – BOJ Statement Does Not Support Yen’s Recent Strength
- EUR/USD, AUD/USD, GBP/USD and USD/JPY Daily Outlook – January 23, 2018
- BTG/USD DASH USD and XMR USD Price Forecast January 23, 2018, Technical Analysis
- Oil Price Fundamental Daily Forecast – Market Saturated With Long Speculators
- Gold Prices Looking to Test Highs of Range