NZD/USD Forecast June 14, 2016, Technical Analysis

The NZD/USD pair went back and forth during the course of the session on Monday, but ultimately ended up forming something akin to a shooting star. The shooting star sits at the 0.7050 level, and that area begins a significant amount of support all the way down to the 0.70 level. Because of this, even if we break down below the bottom of the shooting star I would be hesitant to sell until we broke down below the 0.70 level. On the other hand, if we break above the top of the shooting star for the session on Monday, I believe that would be a very strong sign and buying would pick back up.
Keep in mind that the New Zealand dollar is very sensitive to the commodity markets, and as a result it’s likely that the markets will continue to be very volatile as Marty markets are been influenced by quite a few different things at the same time. After all, we have to worry about whether or not the global economy is even going to grow, and that can have an effect on demand of commodities, but at the same time we have the US dollar with the specter of the lack of interest rate hikes pushing the value of the dollar lower. At this point in time, I think there’s a lot going on, so therefore it’s going to be very difficult to trade this market. However, there will be moments where momentum builds up in one direction or the other, and as a result I think that is how you have to play this market, based upon momentum. That is why I have 2 different scenarios that I’m willing to trade. A break above the top of the shooting star would of course be a sign that we were breaking above the resistance. That of course would be very bullish, and could offer an opportunity. You can also say that a break down below the 0.70 level is reason enough to start selling as it would be a support level giving way.