The New Zealand dollar is lower on Tuesday after the previous session burned out of a jump in the U.S. Treasury interest. Investors are also monitoring the price action in global stock markets, which has been the prominent driver of the Kiwi price action recently.
Kl. 05:41 GMT, den NZD / USD traded at .6084, up 0.0010 or + 0.16%.
Earlier in the meeting, NZD / USD was squeezed after Deputy Prime Minister and Foreign Minister Winston Peters outraged China by saying he supports Taiwan’s involvement in the World Health Organization. China is the largest trading partner for both Australia and New Zealand and NZ’s second largest trading partner.
The volume is on the slight side early Tuesday as investors prepare for Wednesday’s release of the latest Reserve Bank of New Zealand interest rate and monetary policy decisions.
Daily technical analysis of the swing diagram
The main trend is up according to the daily swing chart. However, yesterday’s formation of a closing price reversal peak and a new secondary peak suggest that momentum may be ready to shift to the downside. This can even lead to a change in the down trend.
A trade through .6156 and .6176 will signal a resumption of the downtrend. The main trend changes to down on a trade through the last scalp of .5995.
The main range is .6448 to .5469. Its retracement zone of .6074 to .5958 is support. This zone controls the Forex pair’s short-term direction.
The short-term range is .5911 to .6176. Its 50% level of .6043 also supports. This zone stopped sales earlier today.
Daily technical weather fluctuation
Based on the early price measure and current price of .6084, the direction of NZD / USD for the remainder of the session on Tuesday is likely to be determined by the trader’s response to the most important Fibonacci level of .6074 and the short term 50% level at 0.6043.
A persistent move above 0.6074 will indicate the presence of buyers. If this is capable of generating enough momentum, buyers can take the tops of .6156 and .6176. The latter is a potential trigger point for an upside acceleration with March 9 on top .6448 for the next potential upside target.
A sustained move below .6043 will signal the seller’s presence. This can trigger a break into the last scalp at .5995, followed by the primary 50% level of .5958. This is a potential trigger point for downside acceleration.
Essentially, the next major movement of NZD / USD is determined by the trader’s response to the key 50% to 61.8% range at .5958 to .6074. Trading between these levels will create a lot of noise, leading to an unmanaged, two-sided trade.