The NZD/USD is testing important long-term support levels after suffering a steep bearish move the past week of trading. As of this writing, the NZD/USD is near the 0.69500 juncture and the last time the Forex pair traversed this value was in March of this year. However, it hasn’t been since the last week of November 2020 that the NZD/USD has seriously traded below the current values being demonstrated. If downside pressure doesn’t relent, it will test the endurance of speculators who still cling to bullish perceptions.
The swift bearish momentum which has been vicious the past week has largely developed as behavioral sentiment has been rattled by the actions of the U.S Federal Reserve. Technically, the NZD/USD was within the healthier part of its rather bullish price range as late as the 14th of June, when the Forex pair was valued near the 71.40000 ratio. Speculators who have been wagering on upside since that moment hopefully have been practicing their risk management with strong stop-losses.
The NZD/USD is a fast-moving Forex pair which always offers a rather intriguing speculative landscape. The NZD/USD is capable of producing solid trends which are rather consistent. Unfortunately for many traders caught off guard the past week, the sudden bearish cycle within the NZD/USD is a reminder that trends can reverse with violence.
The question that brave speculators may be asking at this point is if the NZD/USD has traversed too low in the past week. Current support junctures of 0.69500 to 0.69300 may prove vital. If the lower elements of support prove vulnerable, it is possible the NZD/USD could test mid-November 2020 ratios close to the 0.69000 level. From a risk/reward perspective, technically, traders may be believe the upside offers more room to see substantial gains, but the timing of this potential reversal higher could prove awkward.
The NZD/USD is likely to remain volatile in the near term. It would not be surprising to see the Forex pair challenge support levels below and then suddenly start to incrementally reverse higher. Conservative traders should be cautious. Speculators may want to pursue a bit more selling, but then be ready to potentially seek upside if lower values are displayed near the 0.69200 to 0.69100 marks. Traders need to remain alert and nimble when participating in the NZD/USD because it certainly can move at great speeds.
NZD/USD Short-Term Outlook:
Current Resistance: 0.69950
Current Support: 0.69200
High Target: 0.73120
Low Target: 0.70510
