NZD/USD Forecast May 29, 2017, Technical Analysis

The NZD/USD pair was relatively flat at the beginning of the session, but Friday saw buyers jump into the market and push towards the 0.71 handle above. I believe that short-term pullbacks offer value in this market, and it looks very much like a market that continues to try to grind higher. I believe that the 0.70 level underneath will be massively supportive, so it’s not until we break down below there that I would even remotely consider selling. I believe that the buyers will continue to go long, as the market seems to be favoring the upside. The market continues to be very risk sensitive, so if we get some type of general melt down, it’s likely that the market here will fall as well. With that being the case, the kiwi dollar is very susceptible to outside influence.
However, …
I believe that this market has plenty of upward pressure currently, so it’s likely that the volatility will not only continue, but it may very well increase. The kiwi dollar is highly sensitive to the overall attitude of the commodity markets, and that of course is something that you should be paying attention to, and not any particular commodity market, but the overall attitude of commodity markets in general. The markets continue to be volatile, and I think that will show itself in this pair. One of the main drivers of the New Zealand strength has been a lot of the political theater coming out of Washington DC, so it’s very difficult to imagine that it won’t affect this pair again as it seems to be an an almost daily occurrence. The pair should be traded from a short-term perspective only, and I believe that will be the only way that it will be navigated.