U.S. Overnight Forex Brief-Trading The NZD/USD

As the midpoint of the U.S. trading day draws near, it is time to begin looking toward the horizon for opportunity. This week’s economic calendar is relatively sparse, but there are a few items set to take place in the coming hours that are worthy of note.

Highlights of the report schedule for the next 24 hours:

• U.S., Consumer Credit

• API Crude Oil Stocks

• China, Trade Balance

• Canada, Housing Situation

There are many secondary metrics also due out, but none with market-moving potential. Nonetheless, it is a good idea to account for risk as their findings are released.

NZD/USD Technicals

The headliner of tomorrow’s U.S. session will be the Reserve Bank of New Zealand’s (RBNZ) announcement on interest rates. Experts are calling for the rates to be held steady at 1.75%, staying the economic course.

NZD/USD, Daily Chart

In a similar fashion as the AUD/USD, there is downside potential for the Kiwi. While I don’t expect any surprises from the RBNZ, it is best to be ready for anything.

Key levels:

• Resistance(1): 38% retracement of the current wave, .6965

• Resistance(2): 20 Day EMA, .6965

• Resistance(3): Bollinger Band, .6993

• Macro Support(1): Yearly Double Bottom, .6817

Overview: The NZD/USD is trading very near 2017’s lows in a compressional fashion. The long-term trend has been extremely bearish, lending credence to another test of the double bottom at .6817.

Price is clearly in a consolidation phase between .6817 and the 38% retracement of the current wave (.6965). Technically, the downtrend has not yet been compromised and a long-term reversal is suspect.

Tomorrow’s RBNZ announcements have the potential to move this market considerably. The timing of the release will be around 3:00 PM EST, so we will have a chance to observe and diagnose price action in-depth ahead of the announcements.

Until then, trade smart and check out some of the active positions on the live signals page for trading ideas facing a broad spectrum of products.