NZD/USD looks ready to make fresh monthly lows as it finds resistance near a key inflection point!
Think we’ll see further NZD/USD losses in the next trading sessions?
Here’s what’s cooking on the 4-hour time frame:
NZD/USD 4-hour Forex Chart by TradingView
With no major data releases out of New Zealand this week, the New Zealand dollar’s moves have mostly followed U.S.-China trade headlines and shifts in risk sentiment. Unfortunately, those same trade and geopolitical jitters have kept demand for the commodity currency in check.
The U.S. dollar, meanwhile, is holding up better as traders take some profits off their short positions ahead of Friday’s U.S. CPI report. Falling gold prices are also adding a little extra support for the Greenback.
Will the tides change in the next trading sessions as traders brace for Friday’s anticipated data releases?
Remember that directional biases and volatility conditions in market price are typically driven by fundamentals. If you haven’t yet done your homework on the U.S. dollar and the New Zealand dollar, then it’s time to check out the economic calendar and stay updated on daily fundamental news!
NZD/USD has been in a downtrend since late June, forming a steady pattern of lower highs and lower lows along a descending trend line that has been in play since mid-September.
Recently, the pair turned lower from around the .5740 area, which lines up with several resistance levels, including the R1 (.5759) Pivot Point, the 100 SMA, the trend line resistance, and the 38.2% Fibonacci retracement of October’s downswing.
More bearish candlesticks from here could pull NZD/USD back toward its October low near .5680, or even fresh monthly lows if the downtrend continues.
If momentum shifts in the Kiwi’s favor and NZD/USD holds above .5750, however, the pair could aim for the .5800 psychological level and possibly retest the .5850 area of interest.
Whichever bias you end up trading, don’t forget to practice proper risk management and stay aware of top-tier catalysts that could influence overall market sentiment.
Disclaimer:
Please be aware that the technical analysis content provided herein is for informational and educational purposes only. It should not be construed as trading advice or a suggestion of any specific directional bias. Technical analysis is just one aspect of a comprehensive trading strategy. The technical setups discussed are intended to highlight potential areas of interest that other traders may be observing. Ultimately, all trading decisions, risk management strategies, and their resulting outcomes are the sole responsibility of each individual trader. Please trade responsibly.
