I’ve been talking about how bullish I am on the kiwi…here’s the other side of the coin.

Maybe I’ve had kiwi on the brain.

I have been talking about why I’ve been so bullish and I never like it when I’m only focused on one side of the trade.

So here’s a breakdown about where the NZD/USD could find some selling pressure after what’s been a strong move higher from 0.7900 to now just above 0.8200.

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The daily NZD/USD enjpyed a late week rally to go into the three-day U.S. holiday weekend. But if the U.S. Dollar Index breakdown through 75.00 stalls, this could begin an NZD/USD correction lower. Chart pattern alert courtesy of Autochartist.

The daily NZD/USD has rallied to the upper trendline resistance level of a year-long Rising Wedge. The pair is also testing the waters above 0.8200 which I will be watching closely for bullish momentum. So far, and remember it IS Sunday so confirmation as the European session is requires but the Monday trading session in the U.K. and U.S. will be light due to bank holidays.

But the timing of the U.S. Dollar Index 75.00 level and the resistance of the pattern on the NZD/USD could set up a correction in each. This would this bode well for intraday bulls who are waiting for an opportunity to buy into the uptrend. The 60 and 240-minute time frames are both still in “twelve to two o’clock” uptrends. I am favoring the deeper pullback to the support of the “swing buy zone” on the 240-minute which would put the entry area between 0.8105 and 0.8080.

  • Raghee Horner

    The U.S. Dollar has begun to sink going into the Tuesday Asian session on positive news about Greece (what else is new?? and how long before “bad” news comes rolling along again??) BUT FOR NOW, the dollar weakness through 75.00 will move the kiwi higher and crude oil is still perched above $100/bbl.

  • Mattspips

    The uptrend being as steep as it is leads me to believe its going to come back down a bit, right now I see some divergence on the 14 period RSI, and I think we see a pullback to the 0.80 area too. 

    • Forex Trading Tips

      Quite true… steep uptrends give me chills.