New Zealand dollar showing signs of support on weekly chart

The New Zealand dollar initially fell during the week but turned around to form a bit of a hammer looking candle. The market is currently hanging about the 0.7250 level, an area that has been important more than once. I believe that if we break down below the bottom of the candle though, that should be a very negative sign, and it should send this market looking towards the 0.70 level. The market will continue to be noisy based upon the charts I’m looking at, but I do think that we are trying to build up enough momentum to finally go higher.

Keep in mind that the New Zealand dollar is highly sensitive to risk appetite overall, so pay attention to stock markets and commodity markets as they have a major influence on how this currency pair will go. I also believe that the trading will be a bit difficult, but I think that longer-term investors are looking for a move to the upside. If we can break above the 0.75 handle, that would show an extreme amount of strength. The market looks as if it is forming some type of bullish flag, and if we can break above the top of that flag, then I think we can go much higher and eventually take on the 0.77 level. However, it’s going to take a lot of work.