New Zealand Dollar Weekly Price Outlook: Kiwi Coils Into January Range

In this series, we scale-back and look at the broader technical picture to gain a bit more perspective on where we are in trend. The New Zealand Dollar is up nearly 0.4% against the US Dollar this week as price continues to contract within the January opening-range. Here are the key targets & invalidation levels that matter on the NZD/USD weekly chart.

NZD/USD WEEKLY PRICE CHART

(Click on image to enlarge)

New Zealand Dollar vs US Dollar, NZD/USD Weekly Price Chart

Notes: Kiwi started the year with a quick defense of the 61.8% retracement` of the October advance at 6632 (intraday spike low registered at 6586) before rebounding sharply with price testing monthly open support this week at 6705. The late-2018 advance looks to have taken the shape of a 5-wave advance off the lows and suggests this pullback from the December high may be a correction. That said, the focus would be for a new low before resumption higher towards broader pitchfork resistance (blue).

Initial weekly resistance stands with the parallel (red) backed by the 52-week moving average at ~6880s and the 50% retracement of the 2018 range at 6931- a breach / close above this threshold is needed to fuel the next leg higher targeting the 200-week moving average at ~6960s and the key 61.8% retracement at 7050.

Critical support remains with the October slope line / 6632 with a break / close below exposing subsequent support objectives at the 2018 low-week close at 6507 and the 100% extension / 2015 LWC at 6453/65- both levels of interest for exhaustion / long-entries IF reached.

Bottom line: Kiwi continues to trade within the confines of a broad January opening-range and while I do think the bigger move ultimately is higher, the threat remains for another test of the lows before resumption. Form a trading standpoint, the focus is on a test of the monthly lows – IF price can stabilize above 6632, look for a breach above the range highs to fuel the next leg higher in New Zealand Dollar.

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