The New Zealand dollar has rallied initially during the trading session on Tuesday, but rolled over rather significantly as the Americans came on board. The market breaking below the 0.6950 level would be a very negative sign, as we would slice through a previous uptrend line to the downside yet again. This would show a significant failure of bullish pressure, and could send this market down towards the 0.6825 level underneath. The volatility will be high of course, as it typically is with the New Zealand dollar, but one thing that you should pay attention to is the commodity markets. I think that the market will be very noisy, but at the end of the day I think that the sellers are going to assert their pressure in this pair.
It appears to me that the 0.70 level is offering resistance, and therefore I think that the downward trend is going to continue. This could give us a target of 0.68 underneath, which was the recent lows. We’ve seen the New Zealand dollar gain significant momentum over the last several weeks, but at the end of the day it appears that it is being reversed as I record this. Alternately, if we can break above the 0.7033 handle, then the market will continue to the upside but right now it doesn’t look likely. With this volatility, it will typically bring more fear into the market, which is negative for this currency.
NZD/USD Video 20.12.17
This article was originally posted on FX Empire