NZD / USD Forex technical analysis – strengthening above 0.7232, weakening below 0.7206

The New Zealand dollar was trading significantly higher on Wednesday after data released by Statistics New Zealand showed the country’s unemployment rate fell in the fourth quarter, beating analyst projections as the economy recovered from the COVID-19 pandemic .

The seasonally adjusted unemployment rate fell to 4.9% in December 2020, from 5.3% in September 2020, Statistics New Zealand said in the statement. This exceeded the forecasts of the economists polled by Reuters, who had expected an unemployment rate of 5.6%.

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At 06:43 GMT, NZD / USD is trading at 0.7216, up 0.0021 or + 0.28%.

Daily swing chart technical analysis

Daily swing chart technical analysis

The main trend has increased according to the daily swing chart, but momentum has decreased over the last six sessions. Trading above .7248 signals a resumption of the uptrend. The main trend will change on a move down through .7106.

The small trend is down. This controls the momentum. A trade above .7226 will change the small upward trend. This will shift the momentum up. A new, smaller bottom has formed at .7135.

The main range is between .7003 and .7316. The retracement zone at .7159 through .7123 is support.

The short-term range is between 0.7316 and 0.7096. The NZD / USD is currently testing its retracement zone at .7206 through .7232. The trader’s reaction to this zone determines the short-term direction of the forex pair.

Daily Swing Chart Technical Forecast

Daily Swing Chart Technical Forecast

Based on the early price move, the direction of NZD / USD will be determined by the trader’s reaction to the near-term 50% level at 0.7206.

Bullish scenario

A sustained move above .7206 indicates the presence of buyers. This could trigger a rally into the short-term Fibonacci level at 0.7232, followed closely by the main spike at 0.7248.

If you take out .7248 the main trend will change upwards. We could see an acceleration upwards, with 0.7316 being the next big target.

Bearish scenario

Continued move below .7206 will signal the presence of sellers. If this move is creating enough bearish momentum, look for a possible break into the main retracement zone at .7159 through .7123.

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NZD / USD Forex technical analysis – strengthening above 0.7232, weakening below 0.7206
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