The New Zealand Dollar is inching higher against the U.S. Dollar on Friday, and in a position to end a choppy week with a slight gain as surging coronavirus infections cast a shadow over encouraging economic data in the U.S. and Europe and checked hopes for a swift global recovery.
A rise in U.S. equity futures early Friday and small gains in Asia and Europe are helping to push up demand for higher risk currencies, dampening the U.S. Dollar’s safe-haven appeal.
At 06:04 GMT, the NZD/USD is trading .6441, up 0.0010 or +0.16%.
Daily Swing Chart Technical Analysis
The main trend is up according to the daily swing chart. A trade through .6381 will change the main trend to down. A move through .6533 will signal a resumption of the uptrend.
The minor range is .6585 to .6381. Its pivot at .6483 is controlling the near-term direction of the NZD/USD.
The short-term range is .5921 to .6585. If the main trend changes to down then its retracement zone at .6253 to .6175 will become the primary downside target.
Daily Swing Chart Technical Forecast
Fundamentally, the direction of the NZD/USD will be determined by investor demand for risk. If today is a “risk-on” session then look for the Forex pair to rise as this would encourage investors to shed safe-haven U.S. Dollar positions.
A “risk-off” session will put renewed pressure on the Kiwi especially since the Reserve Bank of New Zealand made dovish comments on monetary policy earlier in the week.
Overtaking .6483 will indicate the return of buyers. This could trigger a surge into .6533. Overtaking this price will also be a sign of strength.
A failure to overcome .6483 will signal the return of sellers. However, the trigger point for an acceleration to the downside is .6381. If this price is taken out, we could see an eventual break into the short-term 50% level at .6253.
For a look at all of today’s economic events, check out our economic calendar.
This article was originally posted on FX Empire
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