NZD/USD: Breaching 0.67000, Where to next???
Hello Traders and welcome back to EverythingFX.
The New Zealand Dollar currently trading at 0.67307 against the US Dollar during today's London session.
As explained in our previous article we were anticipating a break of 0.67000 which has since been successfully fulfilled.
Looking on a higher timeframe we can see buyers are back in control on this pair with a very strong weekly candlestick closure on Friday. We have since seen that follow through upon market open with positive Chinese Data coming out this morning strengthening the Asian Economy which in return assisted in the rise of the Kiwi early hours this morning.
On a technical note, I would like to see a re-test of 0.67000 before potentially going higher! Upon a bullish rejection, we could then have a really good risk to reward to the upside with our next level of resistance at 0.69000 providing us with a good 200 PIP move to the upside. What would invalidate this bias is daily candlestick closure below 0.67000.
Fundamentally we have the Fed which has now turned fairly Dovish potentially looking to cut interest rates at the next meeting which is fairly negative for the dollar however the Fed will be monitoring data closely to see whether they would cut by 25 bp or 50 bp. A 25 bp rate cut is already priced in, which assisted in this rally to the upside on this pair. We now need to closely monitor how the Fed reacts to data coming out this week. Stay tuned to our market news section as well as social media for further updates.