NZD/USD Forecast October 10, 2017, Technical Analysis

The NZD/USD pair continues to see volatility, capping lower at the open on Monday, only to turn around and fill that gap and start falling again. It looks as if we’re going to go looking towards the 0.70 level, an area that will have a certain amount of psychological support. It’s an area that has been supportive in the past, as well as resistive so I expect to see a lot of volatility around that large figure. Remember, the New Zealand dollar is highly sensitive to commodities, and of course the risk appetite globally. Although stock markets have done a bit better, the reality is that the New Zealand dollar is a bit less liquid than the other major currencies, so you tend to see volatility here quicker than other places.
We have been in a downtrend over the last several days, and it looks like we could continue that bearish pressure. I don’t know whether we can break down below the 0.70 level, but if we did, that would be a very negative sign. At that point, I would anticipate that the market will probably go looking towards the 0.68 level underneath, which is the next major support level based upon the longer-term charts. Anticipate a lot of volatility, but overall I think the sellers are having their way with the riskier currencies at the moment. On top of all of this, the Australian dollar is falling, and the 2 currencies tend to move in the same direction over the longer term, especially when it comes against the US dollar. Rallies this point in time or to be sold, unless of course we can break above the 0.7125 level, which would have me looking for a move to higher levels, perhaps the 0.72 level above.