NZD/USD – The Kiwi Dollar Shoots Higher after the RBNZ

Points to consider in this Forex market:

• The NZD/USD breaks through the top after the RBNZ rate decision.
• Price action remains narrow to justify a trade.
• Trae strategy: Stand aside

The NZD/USD Forex market continues to move higher after completing a bullish head and shoulders pattern (H&S). The New Zealand Dollar is now above a six week high price point as buyers are eyeing the pivots at 0.68 and 0.69. Overnight, the Reserve Bank of New Zealand (RBNZ) slashed interest rates supporting the Kiwi Dollar.

Technical Analysis

Let’s discuss today’s NZD/USD daily technical analysis. There is near term support at a former resistance level at 0.6778. A daily close below this level challenges a cluster zone that runs from the Nov 18 low to the rising trend line support. This area is from 0.6590 to 0.6618. The Alternative technical analysis for the New Zealand Dollar, notes technical resistance at 0.6788. A break above this level challenges the horizontal pivot at 0.68.

Trade Strategy

Let’s now discuss today’s NZD/USD trade strategy. Even after the RBNZ rate decision, price action remains inconclusive. We need to breach a trend line support, but the overall bias in this market is still bearish NZD. These gains are corrective, and I will enter a short NZD sale once this correction higher exhausts itself. Keeping this in mind, I will opt to stand aside until a better short NZD sale opportunity comes along, this should happen once this bullish correction finishes. For today I will remain flat in the NZD/USD Forex market.