InstaForex

August 24, 2021

Daily U.S. Session Watchlist: NZD/USD

 Risk appetite seems to be lifting this pair lately, but could the rally last or is this a mere pullback?


Here are the levels and catalysts I’m watching.


Before moving on, ICYMI, I’ve listed the potential economic catalysts that you need to watch out for this week. Check them out before you place your first trades today!


And now for the headlines that rocked the markets in the last trading sessions:


Fresh Market Headlines & Economic Data:

Asian shares track Wall Street rally ahead of Jackson Hole

New Zealand headline retail sales up 3.3% in Q2 vs. 2.4% forecast

New Zealand core retail sales rise 3.4% in Q2 vs. 2.1% forecast

New Zealand’s Q1 2021 retail sales figures upgraded

RBNZ Assistant Governor Hawkesby: Rate changes not tied to lockdowns

German final GDP upgraded from 1.5% to 1.6% in Q2

European markets advance, buoyed by travel stocks

Crude oil edges higher on Pfizer full FDA clearance

Upcoming Potential Catalysts on the Economic Calendar:

U.S. new home sales and Richmond manufacturing index at 2:00 pm GMT

Australia’s CB leading index at 2:30 pm GMT

New Zealand trade balance at 10:45 pm GMT

If you’re not familiar with the forex market’s main trading sessions, check out our Forex Market Hours tool.


What to Watch: NZD/USD

It’s a textbook break-and-retest setup y’all!


NZD/USD fell through the floor at the .6935 area, dipping to a low of .6805 before pulling back up. Right now, the pair is pulling back to the area of interest.


Will it hold as resistance?



The Fibonacci retracement tool reveals that the 50% level lines up with the former support zone, adding to its strength as a potential ceiling. That’s right smack in line with the 200 SMA dynamic resistance, too!

The 100 SMA is below the 200 SMA to confirm that resistance levels are more likely to hold than to break.


At the same time, Stochastic is already reflecting exhaustion among buyers and heading down to signal a pickup in bearish pressure.


Earlier on, the Kiwi drew support from upbeat quarterly retail sales data, along with hawkish comments from an RBNZ official.


But could the Greenback bring sexy back?


There are no major reports lined up from the U.S. in the upcoming trading session, so any dollar moves might be based mainly on market sentiment.

Aside from that, market watchers are expecting Fed head Powell to discuss the central bank’s taper timeline during the Jackson Hole Symposium. This could be enough to keep the Greenback supported leading up to the event.


Just be on the lookout for a move past the 61.8% Fib that might signal that Kiwi bulls are regaining the upper hand, and don’t forget to look at the average NZD/USD volatility as well.