Current trend

NZD against USD continues to decline. From mid-April, the pair lost almost 1000 points and returned to the lows of early 2016 at the levels of 0.6500 and 0.6420. In mid-September, the pair rose to 0.6700, but reversed and went down again. Last trading week, the instrument lost 180 points and renewed the local minimum at 0.6420. The main catalyst of the movement is the fall of NZD due to soft monetary policy. Despite the fact that USD is declining against its most competitors, it is growing against NZD.

At the end of the current trading week, special attention should be paid to data on US indices and inflation statistics.

Support and resistance

In the short term, the downward impulse is expected to strengthen to the level of 0.6340. Further, the pair will be trading within the downwards channel with the targets at 0.6275 and 0.6225 (local minimum of the end of 2015). This level is a strong support, here the growth of demand for the oversold NZD and the closing of profitable short positions are expected, and then a long upward correction is predicted.

Technical indicators confirm a further decline: the volume of MACD short positions is growing, Bollinger bands are pointing downwards.

Resistance levels: 0.6500, 0.6545, 0.6575, 0.6615, 0.6725, 0.6770.

The levels of support: 0.6420, 0.6360, 0.6340, 0.6275, 0.6225.

Trading tips

It is relevant to increase the volumes of short positions from the current level and open pending positions from the level of 0.6450, 0.6500 with the targets at 0.6275, 0.6225 and stop loss 0.6540.

New Zealand Dollar vs US Dollar

BuySellSpread
0.688240.6872599

Scenario

TimeframeWeekly
RecommendationsSELL
Entry Point0.6428
Take Profit0.6275, 0.6225
Stop Loss0.6480
Support levels0.6225, 0.6275, 0.6340, 0.6360, 0.6420, 0.6500, 0.6545, 0.6575, 0.6615, 0.6725, 0.6770

Alternative scenario

RecommendationsSELL LIMIT
Entry Point0.6450, 0.6500
Take Profit0.6275, 0.6225
Stop Loss0.6540
Support levels0.6225, 0.6275, 0.6340, 0.6360, 0.6420, 0.6500, 0.6545, 0.6575, 0.6615, 0.6725, 0.6770
NZD/USD: within the long-term downward trend

The material published on this page is produced by the Claws&Horns Company and should not be considered as the provision of investment advice for the purposes of Directive 2004/39/EC; furthermore it has not been prepared in accordance with legal requirements designed to promote the independence of investment research and is not subject to any prohibition on dealing ahead of the dissemination of investment research.

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