NZD/USD Forecast September 21, 2017, Technical Analysis

The New Zealand dollar exploded to the upside as traders are anticipating the Federal Reserve not being able to raise rates anytime soon, and of course a light touch on the markets will be needed after the hurricanes that have recently struck the United States. Because of this, it should continue to drive down the value of the US dollar as the New Zealand dollar is benefiting from being a higher-yielding currency. At this point, pullback should continue to be buying opportunities, and I think that the New Zealand dollar is going to go hunting for the 0.75 level above which has been significant resistance in the past. Obviously, this market is highly influenced by commodities, but at this point it’s going to be a US dollar story more than anything else. The Federal Reserve is likely to sit on its hands for the short term at least, but I still think that we will probably see interest rate hikes down the road. Nonetheless, it’s not enough to scare the market off.
Buying the dips
I think that we will see support at large numbers, for example the 0.73 level. I think that any time this pair pulls back, it is offering a buying opportunity as we certainly have momentum to the upside. I certainly would not want to short this market, because it would be fighting what is an obvious move. If we can break above the 0.75 level, the market could explode too much higher levels, but I do anticipate that the 0.75 level will be significant resistance. It may take several attempts to get above that level, but once we do I think that the floodgates will open. Alternately, if we did somehow managed to break below the 0.72 level, that could spell serious trouble.

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