The New Zealand Dollar[1] is on the defensive early in the week with Kiwi[2] down more than 0.8% against the US Dollar[3]. The decline takes price within 0.9% of the yearly lows and major technical support and while the broader outlook remains tilted to the downside, the immediate decline remains vulnerable into this region. These are the updated targets and invalidation levels that matter on the NZD[4]/USD[5] weekly chart. Review my latest Weekly Strategy Webinar[6] for an in-depth breakdown of this Loonie[7] price setup and more.
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New Zealand Dollar Price Chart – NZD/USD Weekly
Chart Prepared by Michael Boutros[10], Technical Strategist; NZD/USD on Tradingview[11]
Notes: The New Zealand Dollar has been trading within the confines of a descending channel formation extending off the March high with price rebounding off the lower parallel on building momentum divergence late-last month. The turn came just pips from a key support confluence at 6179/97 – a region defined by the 1.618% extension of the 2017 decline and the 2015 swing low. This threshold is backed closely by a longer-term trendline extending off the 2000 / 2009 swing lows, currently around ~6160s.
So, was last month’s low a more significant reversal? If it was, pullbacks in price should be short-lived. Look for initial weekly resistance at the 2016 swing-low at 6347 backed by 6424 and the 2018 low-week close at 6506- expect a bigger reaction there if reached.
For a complete breakdown of Michael’s trading strategy, review his Foundations of Technical Analysis series on Building a Trading Strategy[12]
Bottom line:
