NZD/USD Forex Technical Analysis – Needs to Hold .7121 Fibonacci
The New Zealand Dollar is edging higher early Tuesday as signs of progress to rein in the pandemic raised hopes its economy was closer to reopening.
The Kiwi is also being underpinned by expectations of a rate hike by the Reserve Bank of New Zealand (RBNZ) and Friday’s disappointing U.S. jobs report that likely signaled the Federal Reserve would refrain from announcing any tapering plans sooner than expected.
At 02:28 GMT, the NZD/USD is trading .7140, up 0.0004 or +0.06%.
Daily Swing Chart Technical Analysis
The main trend is up according to the daily swing chart. A trade through .7170 will signal a resumption of the uptrend.
A trade through .6806 will change the main trend to down. This is highly unlikely but due to the prolonged move up in terms of price and time, traders should watch for the formation of a potentially bearish closing price reversal top.
The short-term range is .7316 to .6806. The NZD/USD is currently trading on the strong side of its retracement zone at .7121 to .7061, making it new support.
The longer-term support zone is .7027 to .6924.
Daily Swing Chart Technical Analysis
The direction of the NZD/USD on Tuesday is likely to be determined by trader reaction to .7121.
Bullish Scenario
A sustained move over .7121 will indicate the presence of buyers. If this creates enough upside momentum then look for the rally to possibly extend into last week’s high at .7170. This price is a potential trigger point for an acceleration to the upside with the minor top at .7243 the next likely upside target.
Bearish Scenario
A sustained move under .7121 will signal the presence of sellers. If this move generates enough downside momentum then look for the start of a steep break with the 50% level at .7061 the next likely downside target price.
Since the main trend is up, look for buyers on the first test of .7061. If it fails then look for the selling to possibly extend into the major 50% level at .7027. Once again, look for buyers on a test of this level.
For a look at all of today’s economic events, check out our economic calendar.
This article was originally posted on FX Empire
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