By FXEmpire.com
The NZD/USD pair managed to both rally and fall during the same session. The candle isn’t quite a shooting star, but it does suggest the same thing: that the bullish traders tried to push this pair higher, and were repelled at the 0.79 handle. Simply put, this pair looks weak at the moment.
If we manage to break down below the 0.7825 level, we feel that this pair would make a return trip to the 0.76 or possibly even the 0.75 support level. On longer-term charts, this pair does look extraordinarily weak, and it does seem that we may be forming a massive descending triangle. This makes sense, as the Kiwi dollar is so sensitive to risk globally, and there are plenty of problems out there to worry about.
Remember though, that the Kiwi dollar tends to follow commodity markets in general, and as such you should give the general feeling for how the various futures markets are behaving around the world. It will need to be a precise reading, just the simple analysis of whether or not the markets are positive on the whole, or are all falling. This pair should follow in tandem if history is any indication.
Because of this, we feel that a move lower from here should signal quite a fall. We think this will be obvious as the risk appetite will express itself as being little to none via stock markets, futures markets, and other risk related currency pairs. This pair tends to move the quickest out of the commodity dollars, and as such this is often the “biggest bang for your buck” when it comes to trading risk appetite.
As far as buying this pair, we don’t think we would do this until we break above the 0.79 level as it proved to be so resistive during the Tuesday session. While initially we would have thought this to have been a great place to go along of this pair, the fact that we failed at that point in time on Tuesday has is concerned about the bullish side.
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Originally posted here
