By: DailyForex.com

The EUR/NZD pair fell slightly during the session on Friday, but as you can see sits just above the psychologically significant 1.55 handle. This area has been rather supportive lately, as we have been consolidating, but as you can see we have been in a downtrend for some time. With this, the market looks as if it’s ready to perhaps bounce from here and head back towards the 1.58 level, but we believe that the area should be rather resistive. If we break above the 1.58 level, there is a downtrend line that we will have to contend with, and if we can get above there all of a sudden this is an uptrend by its very definition of a “higher low.”

On the other hand, if we break down below the 1.55 level, the next significant level below is the 1.50 handle, which of course is a major psychologically significant round number. At that point time, I would expect to see a lot of buyers step into the marketplace, pushing the market back higher. However, the likelihood of a break out right away is probably fairly slight, as I believe a countertrend trade is about to set up.

The New Zealand dollar looks ready to break out, but needs to pullback first.

The NZD/USD pair looks very strong, but also looks as if it could pullback from the 0.88 level, as it is significantly resistant. With that, I believe that the New Zealand dollar will lose a little bit of value in the short-term, but ultimately should continue to go higher, pushing the New Zealand dollar higher against most currencies. I believe that the Euro won’t be any different against the New Zealand dollar, and as a result we will ultimately fall from this general vicinity. However, I recognize that we could get a little bit of a bounce over the next couple of sessions, so I would be willing to buy a hammer in this general vicinity or some type of supportive candle. Once we get towards the 1.58 level though, I would fully anticipate a resistant candle that could be sold. On the other hand, if we simply break down below the 1.55 level, I think we continue to sell off.

EURNZD 7714

Related Articles
  1. Mutual Funds & ETFs

    The 4 Best T. Rowe Price Funds for Growth Investors in 2016 (TROW)

    Discover the four best mutual funds administered and managed by T. Rowe Price that specialize in investing in stocks of growth companies.
  2. Mutual Funds & ETFs

    The 3 Best T. Rowe Price Funds for Value Investors in 2016

    Read analyses of the top three T. Rowe Price value funds open to new investors, and learn about their investment objectives and historical performances.
  3. Tax Strategy

    Profit from Art with a Charitable Remainder Trust

    With a CRUT, art collectors can avoid capital gains taxes on the sale of art– while also leaving their favorite charity a legacy.
  4. Active Trading Fundamentals

    4 Stocks With Bullish Head and Shoulders Patterns for 2016 (PG, ETR)

    Discover analyses of the top four stocks with bullish head and shoulders patterns forming in 2016, and learn the prices at which they should be considered.
  5. Economics

    How Negative Interest Rates Work

    Policymakers in Europe go for the unconventional: negative interest. What could happen?
  6. Budgeting

    The Honest Company Bundles Review: Are They Worth It?

    Learn more about The Honest Company and its bundle subscription services, which deliver discounted diapers, formula and other baby products to your doorstep.
  7. Fundamental Analysis

    Will Airlines Keep Flying High in 2016?

    Learn why the airline industry has such a unique set of variable and fixed costs that makes it very difficult to forecast its performance each year.
  8. Investing News

    These Free Super Bowl Ads Happened (BUD)

    The average 30-second Super Bowl cost marketers $5 million in 2016. But these companies benefited from free advertising during and after the game.
  9. Mutual Funds & ETFs

    Top 3 Lazard Funds for Retirement Diversification in 2016

    Learn about Lazard Asset Management, its long history of strong performance and the top three Lazard funds to consider for retirement diversification.
  10. Investing

    Harry Potter and the Unnecessary 8th Book

    A "special rehearsal edition" of the recent Harry Potter play--to be released July 31 as the eighth book in the series--will boost the franchise's fortunes, which have been sagging lately.
RELATED FAQS
  1. When does a growth stock turn into a value opportunity?

    A growth stock turns into a value opportunity when it trades at a reasonable multiple of the company's earnings per share ... Read Full Answer >>
  2. What is arbitrage?

    Arbitrage is basically buying in one market and simultaneously selling in another, profiting from a temporary difference. ... Read Full Answer >>
  3. What is Fibonacci retracement, and where do the ratios that are used come from?

    Fibonacci retracement is a very popular tool among technical traders and is based on the key numbers identified by mathematician ... Read Full Answer >>
  4. What is a derivative?

    A derivative is a contract between two or more parties whose value is based on an agreed-upon underlying financial asset, ... Read Full Answer >>
  5. What is finance?

    "Finance" is a broad term that describes two related activities: the study of how money is managed and the actual process ... Read Full Answer >>
  6. What items are considered liquid assets?

    A liquid asset is cash on hand or an asset that can be readily converted to cash. An asset that can readily be converted ... Read Full Answer >>
COMPANIES IN THIS ARTICLE
Trading Center