NZD/USD Forex Technical Analysis – Rangebound Trade Signaling Investor Indecision, Impending Volatility

The New Zealand Dollar is trading slightly better late in the session on Friday after giving back some of its earlier gains as a drop in U.S. equity markets soured demand for higher risk assets. The intraday drop in investor sentiment was fueled by disappointing vaccine data from Johnson & Johnson and the continuing spat between Wall Street hedge funds and small, retail investors.

At 19:17 GMT, the NZD/USD is trading .7193, up 0.0037 or +0.52%.

Daily Swing Chart Technical Analysis

The main trend is up according to the daily swing chart, but momentum is trending lower.

A trade through .7248 will signal a resumption of the uptrend. A move through .7096 will change the main trend to down.

The minor trend is down. This is controlling the momentum. It will shift to up when the main trend is reaffirmed.

The minor range is .7316 to .7096. Its retracement zone at .7206 to .7232 is resistance. This zone stopped the selling earlier today.

The short-term range is .7003 to .7316. Its retracement zone at .7159 to .7123 is support. It attracted buyers earlier in the session.

The main range is .6589 to .7316. If the main trend changes to down then its retracement zone at .6952 to .6867 will become the primary downside target.

Daily Swing Chart Technical Forecast

The NZD/USD is currently trading inside a pair of retracement zones at .7159 to .7123 and .7206 and .7232. Look for a choppy, two-sided trade if the Kiwi remains inside these zones.

Overtaking .7206 will indicate the presence of buyers, but I don’t think we’re going to see a breakout to the upside unless buyers can take out .7232 with conviction.

On the downside, the first sign of weakness will be a move under .7159. The trigger point for a potential acceleration to the downside is .7123.