New Zealand Dollar: NZD/USD (NZD=X) .6378 will signal a resumption of the downtrend

New Zealand Dollar: NZD/USD (NZD=X) .6378 will signal a resumption of the downtrend

New Zealand Dollar: NZD/USD (NZD=X) .6378 will signal a resumption of the downtrend

The main trend is down according to the daily swing chart. A trade through .6378 will signal a resumption of the downtrend. The main trend will change to up when buyers take out .6791. This is highly unlikely today.

The minor trend is also down. The minor trend will change to up on a trade through .6588. This will also shift momentum to the upside.

The short-term range is .6791 to .6378. Its retracement zone at .6585 to .6633 is the next upside target and potential resistance.

Daily Technical Forecast

Based on the early price action, the direction of the NZD/USD on Monday is likely to be determined by trader reaction to the downtrending Gann angle at .6471. This angle, moving down at a rate of 0.002 per day from the .6791 top has been guiding the Forex pair lower since July 19.

Bearish Scenario

A sustained move under .6471 will indicate the presence of sellers. If this move creates enough downside momentum then we could see an eventual retest of last week’s low at .6378. If this level fails then look for a test of the January 20, 2016 main bottom at .6346. This is a potential trigger point for an even steep break with the August 24, 2015 main bottom at .6207 the next potential target level.

Bullish Scenario

A sustained move over .6471 will signal the presence of buyers. The next targets are the former bottom at .6481 and a minor high at .6499.

Taking out .6499 could trigger an acceleration to the upside since the daily chart indicates there is room to run with the next targets coming in at .6585 and .6588.

Technical Indicators

Overall, the bias in prices is: Downwards.

By the way, prices are vulnerable to a correction towards 0.66.

The projected upper bound is: 0.65.

The projected lower bound is: 0.63.

The projected closing price is: 0.64.

Candlesticks

A black body occurred (because prices closed lower than they opened).
During the past 10 bars, there have been 3 white candles and 7 black candles for a net of 4 black candles. During the past 50 bars, there have been 25 white candles and 24 black candles for a net of 1 white candles.

A spinning top occurred (a spinning top is a candle with a small real body). Spinning tops identify a session in which there is little price action (as defined by the difference between the open and the close). During a rally or near new highs, a spinning top can be a sign that prices are losing momentum and the bulls may be in trouble.

Three black candles occurred in the last three days. Although these candles were not big enough to create three black crows, the steady downward pattern is bearish.

Momentum Indicators

Momentum is a general term used to describe the speed at which prices move over a given time period. Generally, changes in momentum tend to lead to changes in prices. This expert shows the current values of four popular momentum indicators.

Stochastic Oscillator

One method of interpreting the Stochastic Oscillator is looking for overbought areas (above 80) and oversold areas (below 20). The Stochastic Oscillator is 38.3972. This is not an overbought or oversold reading. The last signal was a buy 6 period(s) ago.

Relative Strength Index (RSI)

The RSI shows overbought (above 70) and oversold (below 30) areas. The current value of the RSI is 29.69. This is where it usually bottoms. The RSI usually forms tops and bottoms before the underlying security. A buy or sell signal is generated when the RSI moves out of an overbought/oversold area. The last signal was a buy 3 period(s) ago.

Commodity Channel Index (CCI)

The CCI shows overbought (above 100) and oversold (below -100) areas. The current value of the CCI is -99. This is not a topping or bottoming area. The last signal was a buy 0 period(s) ago.

MACD

The Moving Average Convergence/Divergence indicator (MACD) gives signals when it crosses its 9 period signal line. The last signal was a sell 13 period(s) ago.

Rex Takasugi – TD Profile

FOREX NZD= closed up 0.000 at 0.645. Volume was 100% below average (consolidating) and Bollinger Bands were 105% wider than normal.

Open     High      Low     Close     Volume___
0.645 0.645 0.645 0.645 7
Technical Outlook 
Short Term: Neutral
Intermediate Term: Bearish
Long Term: Bearish
Moving Averages: 10-period     50-period     200-period
Close: 0.65 0.66 0.67
Volatility: 9 9 9
Volume: 36,435 35,712 41,943

Short-term traders should pay closer attention to buy/sell arrows while intermediate/long-term traders should place greater emphasis on the Bullish or Bearish trend reflected in the lower ribbon.

Summary

FOREX NZD= is currently 4.0% below its 200-period moving average and is in an downward trend. Volatility is relatively normal as compared to the average volatility over the last 10 periods. Our volume indicators reflect moderate flows of volume out of NZD= (mildly bearish). Our trend forecasting oscillators are currently bearish on NZD= and have had this outlook for the last 10 periods. Our momentum oscillator is currently indicating that NZD= is currently in an oversold condition.

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