NZD/USD Price Forecast December 1, 2017, Technical Analysis
The New Zealand dollar fell significantly during the session on Thursday, breaking down below the 0.6880 level to reach as low as 0.6825 during the day. Any rally at this point should be and I selling opportunity though, and I believe that the 0.69 level is resistive. A break above there should then send the market looking for resistance at the 0.6950 level, followed by the 0.70 level after that which I feel is essentially the “ceiling” of the downtrend that we are currently experiencing. Keep in mind that the New Zealand dollar is highly leveraged to risk appetite, which is a bit of a mixed picture right now. Beyond that, there are a lot of concerns with overspending coming out of New Zealand with the election of the Labour Party, so we also have that weight around the neck of the kiwi dollar.
On the other side of the Pacific Ocean, we have U.S. Congress possibly passing a tax reform bill which should send a lot of money flowing into the United States. That of course will lift the value the greenback, and that of course should send this market lower as the US dollar is favored over the riskier kiwi. In general, I believe that selling the rallies continues to be the way to go, and if we can break below the 0.68 level for any significant time, I think we could go much lower, perhaps looking towards the 0.65 handle over the longer term. It will be interesting to see how things play out, but right now I would recommend smaller positions than usual as the volatility could make things very uncomfortable.
NZD/USD Video 01.12.17
This article was originally posted on FX Empire
