New Zealand Dollar Price Outlook: NZD/USD Reversal Halted–Kiwi Levels
- NZD/USDposts outside-weekly reversal off resistance- looking for a low ahead of support at ~63
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The New Zealand Dollar is up more than 0.6% against the US Dollar since the Asia open - despite the advance, the exchange rate remains vulnerable after reversing off technical resistance last week. These are the updated targets and invalidation levels that matter on the NZD/USD weekly price chart. Review my latest Weekly Strategy Webinar for an in-depth breakdown of this Sterling price setup and more.
New Zealand Dollar Price Chart – NZD/USD Weekly
Notes: New Zealand Dollar posted an outside-weekly reversal off confluence resistance last week at 6436 – where the 2018 low-close converges on the median-line of the descending pitchfork formation we’ve been tracking off the late-2018 / 2019 swing highs. The sell-off turned just ahead of a key weekly support zone and the immediate focus is on 6304/14 – a region defined by the yearly low-week close and the 61.8% retracement of the September advance.
A break / close below this threshold would be needed to mark resumption of the broader downtrend with such a scenario targeting 6250/60 and critical support at the 2015 low / 1.618% extension at 6179/97. A breach / close above 6436 is needed to mark resumption of the September advance with such a scenario targeting 6506 and 6564.
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Bottom line:The New Zealand Dollar marked a bearish reversal off key resistance last week and the focus is on confluence support just above the 63-handle. IF Kiwi is indeed heading higher, losses should be limited the figure. From a trading standpoint, be on the lookout for downside exhaustion while above key support with a breach above the median-line needed to put the long-bias back in play. I’ll publish an updated Kiwi Price Outlook once we get further clarity on the near-term NZD/USD technical trade levels.
New Zealand Dollar Trader Sentiment – NZD/USD Price Chart
- A summary of IG Client Sentiment shows traders are net-long NZD/USD - the ratio stands at +2.24 (69.13% of traders are long) – bearish reading
- Long positions are2.86% higher than yesterday and 31.46% higher from last week
- Short positions are 13.99% lower than yesterday and 16.76% higher from last week
- We typically take a contrarian view to crowd sentiment, and the fact traders are net-long suggests NZD/USD prices may continue to fall. Traders are further net-long than yesterday and last week, and the combination of current positioning and recent changes gives us a stronger NZD/USD-bearish contrarian trading bias from a sentiment standpoint.
See how shifts in NZD/USD retail positioning are impacting trend- Learn more about sentiment!
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- Sterling (GBP/USD)
- Gold (XAU/USD)
- Australian Dollar (AUD/USD)
- Canadian Dollar (USD/CAD)
- Crude Oil (WTI)
- US Dollar (DXY)
--- Written by Michael Boutros, Technical Currency Strategist with DailyFX
Follow Michael on Twitter @MBForex
DailyFX provides forex news and technical analysis on the trends that influence the global currency markets.