NZD/USD Forecast December 18, 2017, Technical Analysis

The New Zealand dollar initially broke out above the 0.70 level during the day on Friday, but then pulled back as we reached the highs from the week, and then found the 0.70 level to be supportive, at least at the time of writing. If this area holds as support, this market should continue to go higher, and I would be the first to point out that we are in the oversold position on the stochastic oscillator, and crossing the moving averages. Because of this, I think that the New Zealand dollar will continue to go higher, as it has formed a very bullish candle for the week, and seems to have found the 0.68 level supportive yet again. When you look at the longer-term charts, the 0.68 level underneath is massively supportive, just as the 0.75 level above is massive resistance. This being the case, it’s likely that the market is simply continuing the overall long-term consolidation.

With that in mind, I think that the beginning of next year’s going to be very bullish for the New Zealand dollar, if you can hang on to the volatility. Adding slowly might be the best way to go as we are reaching towards a very thin time of year during the holidays. Then trading conditions can make the currency markets move rather rapidly, but in general I think we have made a serious statement as to where we are going in January. Short-term pullbacks continue to offer buying opportunities, and the New Zealand dollar seems to be telling us that the risk on attitude may be coming back.

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