NZD/USD Forecast May 26, 2017, Technical Analysis

The New Zealand dollar has been all over the place during the Thursday session, as we had initially consolidated sideways, then dipped to the 0.7020 level underneath, forming a hammer on the hourly chart, and then shooting higher from there. Currently, this is a market that is in an uptrend, but we are starting to lose a little bit of momentum. With that being the case, it’s likely that the New Zealand dollar will grind a bit here, and the fact that the Australian dollar has been so noisy is not helping the situation as the 2 currencies tend to move somewhat in tandem against the US dollar. I believe that the 0.70 level underneath will have a certain amount of psychological support attached to it, and on the chart I have the 72 hour exponential moving average which seems to be reasonably reliable at the moment.
Buying on the dips
The market is probably one that will be easier to buy on dips than anything else, so that is probably what I will be doing in the short term. I suspect that most of the moves will be short term in nature, so I’m not looking for anything major at this point. Alternately, if we break down below the 0.6980 level, the market will probably drop down to the 0.6950 level. The market has been in a nice uptrend as of late though, so I still prefer the upside, I just recognize that we have a lot of noise to deal with. A lot of the geopolitical concerns and worse yet, the American political scene, continues to cause noise with anything involving the US dollar, so keep that in mind as well. Smaller positions will probably be one of the better things you can do as far as trading is concerned.
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