NZD/USD Price Forecast November 15, 2017, Technical Analysis

The New Zealand dollar broke down significantly during the trading session on Tuesday, slicing through the 0.69 level. This is an area that shows a certain amount of propensity to be considered “fair value”, and because of that it’s likely that we will continue to see markets go back and forth in this region. By breaking down, it looks as if we could go down to the 0.68 level underneath, which should be supportive. Ultimately, if we break above the 0.69 level, I don’t think we can break above the 0.70 level. This is a market that continues to be very volatile, and back and forth trading is probably what we are going to see more than anything else. The market is very likely to be noisy, as the New Zealand dollar is one of the least liquid of the major currencies, and of course has a massive amount of sensitivity to risk appetite. As stock markets tend to look a bit heavy at the moment, I think that the New Zealand dollar may struggle as well.
I would not take large positions, because quite frankly this is a market that continues to be difficult to get a handle on, and I also recognize that the best way to deal with this type of volatility is to try a range bound system, but you’re going to need 200 points to trade between. Using a smaller than usual trading position is probably the best way to go, that way you can keep yourself a serious trouble. If we were to break above the 0.70 level above, that would be a very bullish sign and should send this market looking towards the 0.72 handle. However, if we break down below the 0.68 handle, the market could drop down to the 0.65 level.