The New Zealand dollar initially falls on Friday but finds support

The New Zealand dollar pulled back initially during the trading session on Friday, reaching down below the 0.7250 level, before finding buyers and pushing this market to the upside to form a nice-looking hammer. · FX Empire

Christopher Lewis

Updated Fri, Apr 6, 2018, 10:41 PM

The New Zealand dollar has fallen during the trading session on Friday but found enough support underneath at the 0.7250 level to turn things back around to form a hammer. The hammer is a very bullish sign, and if we can break above the top of that hammer we could go much higher, perhaps reaching towards the 0.73 level. If we can break above the candle from the Wednesday session, then I think we go to the 0.7350 level, and then eventually the 0.75 level. Remember that the New Zealand dollar is highly sensitive to risk appetite, so pay attention to the stock markets and of course the commodity markets as the New Zealand dollar is so highly sensitive to it.

The market rallying it would be indicative of a very bullish move to the upside. If we break down below the 0.7150 level, it’s likely that the market unwinds down to the 0.70 level. This is a market that I think has plenty of things to think about, especially between the US and China, as some type of breakdown between the 2 would lead to commodity markets rolling over rather significantly. I think that the rhetoric between the United States and China slowing down could send the New Zealand dollar higher. In general, I think that this market is trying to be bullish but obviously we have a lot of noise, and I think that we will eventually find value hunters, at least in the short term. Longer-term, there’s a lot to consider out there still.