Once again, welcome dear traders!
Well, Friday and the thin Christmas market give reason to consider tools that don't often come into view. One of these, in my opinion, is the currency pair NZD/USD, where events are developing very interesting.
As has been repeatedly noted, the imminent conclusion of the first phase of the trade deal between the US and China gives reason for optimism to market participants. In this regard, there is a growing appetite for risky assets, one of which is the New Zealand dollar. In general, it should be noted that all commodity currencies show a serious strengthening against the US dollar, but in this article, we will consider the New Zealand currency and its prospects.
Weekly
So, after the appearance of the Doji candle with a longer lower shadow last week, the further prospects for the price movement of the NZD/USD pair could be characterized as uncertain. I would not be at all surprised if the current five-day trading would see a drop in the rate.
However, the market decided otherwise, and we see a very strong upward momentum. The pair not only entered the limits of the Ichimoku indicator cloud and broke through the 89 exponential moving average, but also shows its readiness to go up from the cloud with all its attitude. If this happens and the trading closes higher, the prospects for further strengthening will only increase. In this case, we can expect the growth towards the important and strong price zone of 0.6790-0.6800. In my opinion, this is where the further fate of the asset will be decided.
At the moment, we expect the final closing price of weekly trading and the ability of the pair to go up from the Ichimoku cloud.
Daily
In this timeframe, the growth of the "New Zealander" is observed even more clearly. However, I would like to note right away that purchasing on highs is not the best solution. Corrective rollbacks have not been canceled, and after such rapid growth, the chances of them only increase. However, the corresponding signals of the Japanese candlesticks for a decrease have not yet been observed.
It seems that the best option for opening positions is to wait for a corrective pullback to the price zone of 0.6635-0.6620 and buy "kiwi" from there. But the appearance of a reversal candle can signal such a rollback. In this case, those who wish can try to sell the pair, but so far only in the hope of correction. At this point, bullish sentiment is extremely strong, and this needs to be taken into account.
H4
The pair continues to move in the ascending channel of 0.6326-0.6409 and 0.6635. At the same time, it should be noted that the quote came to the upper border of this channel, where a little higher is a strong and important level for market participants - 0.6700.
At the moment of completion of the review, the channel's resistance line is already being tested for a breakdown, but for the success of the mission, the NZD/USD bulls will have to pass the mark of 0.6700. Given this fact, it is quite possible that a reversal bearish candle, or several candles, will appear in the price area of 0.6690-0.6700, after which the rate will fall to the area of 0.6650-0.6635, where it will again find support and turn towards the main upward trend.
If this assumption turns out to be true and signals to decline to appear in the zone 0.6690-0.6670, those who wish can try to sell with targets in the area of 0.6650-0.6635. From here it is already worth considering purchases. It is also necessary to understand that the reversal and rollback of the pair may occur (if at all) not necessarily today.
I would like to draw your attention to the fact that in the current situation, sales are exclusively corrective, and therefore riskier.
For those who do not want to take risks, it is better to skip the rollback and prepare to open long positions from the designated zone.
Successful completion of weekly trading!
