NZD / USD pushed higher today, erasing all of yesterday's losses caused by trade balance lower than expected. However, this time there was no economic news releases that could have triggered such a "good impression" factor on the Kiwi dollar. The only upside driver was feeling a little more positive upward that led Asian stocks higher (Nikkei 225 + 1.22%, Kospi + 0.46%), but gains in New Zealand major indexes were more modest, NZX 50 growth of 0.02% and the NZX 10 Index gained just over 0.12%. Midcap index declined instead, closing 0.08% lower, suggesting that gains NZ stocks that are volatile and less directional movements. Although she was bullish directional, it is difficult to justify nearly 60 pips move in the NZD / USD with this sweet bullish sentiment.
Therefore, we are once again left with Technicals as a reasonable explanation for why NZD / USD pushed higher. There is some truth in this statement as there were technical influences of notes in the sell-off that pushed prices down to 0.822. In this light, it is understandable to see how prices have managed to hit the resistance of 0.829 today as it is simply the result of technical bulls pushing prices to rebound from the 0822 and 0824 support levels.
hourly chart
If the above statement is true, then the probability of 0.829 maintaining resistance becomes higher because there is not nothing fundamental that can help sell more optimistic force. Technical bear should be more to the task, especially as the stochastic overbought readings are already deeply with Stoch curve is lower score. A bearish signal is formed if price manage to trade below 0.827 Stoch line coinciding with the growing below 80.0
Weekly Chart
weekly chart is slightly bearish current price level is an affirmation of the bearish rejection 0.85. Stochastic agrees that the readings are already in the overbought region, opening the possibility of a future downward cycle (which can be as Stoch indicators are now late) that can lead us to 0.81 or higher depending on the Top Channel more high.
Basically, the case for a stronger NZD is there but perhaps pairing with stronger USD may not be the best idea that we could end up with two opposite directionless competing forces. Therefore, traders should continue to seek alternatives other NZD pairs that can provide strong directional movements
Links :.
GBP / USD - Rebounds well off support at 1.60
AUD / USD - Continues to Drift Lower below 0.94
EUR / USD - Inverse strongly back above 1.35
This article is only for general information purposes. It is not investment advice or a solution to buy or sell securities. Opinions are the authors; not necessarily that of OANDA Corporation or its subsidiaries, officers or directors. Leveraged trading is high risk and not suitable for all. You could lose all of your deposited funds.
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