NZD/USD Forecast October 4, 2017, Technical Analysis

The NZD/USD pair fell significantly during the day on Tuesday, reaching towards the 0.7150 level, but then bounced to reach towards the 0.7180 level. We then rolled over again, and as I write this, we are rolling over even farther. I think that the market is probably going to go looking towards the 0.71 level underneath, which of course is massively supportive. If we can break down below there, then the market goes down to the 0.70 level which of course will be much more significant support as it is a large, round, psychologically significant number. Ultimately, this is an area that has been both support and resistance in the past, so I think it will be a very interesting place to play this market. With that being the case, I suspect that we will see quite a bit of volatility but with more of a downward slant than anything else.
I believe that short-term rallies should be selling opportunities, especially if the commodity markets can rollover as well. However, I think that the Americans will probably pick up the New Zealand dollar, as they have been much more bullish on risk than the rest of the world as of late. Because of this, I anticipate that choppiness will continue to be a mainstay in this market, with fortunes changing back and forth rather rapidly. If we did break above the 0.72 level, the market would have the opportunity to reach much higher, but I think it’s going to be difficult overall, and therefore the New Zealand dollar might not be the best place for traders unless they have the ability to hang onto longer-term trades and be patient with significant volatility and of course concerns as the New Zealand dollar is highly sensitive to risk appetite.

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