New Zealand dollar struggles at significant resistance

The New Zealand dollar trying to break above the 0.70 level during the day on Friday but then turned over to fall rather significantly. I think that the market is going to go looking towards the 0.6950 level, and I think if we can break down below there it’s likely that we could go down to the 0.69 level rather soon. Rallies are to be shorted, based upon the exhaustive candle on Thursday, especially considering it is at such a major resistance barrier. The market should continue to be very noisy, but I think it’s only a matter of time before the sellers get involved and try to push lower. Remember, the 0.68 level has been massive support, and I think that the level will continue to be so, at least in the foreseeable future.

The New Zealand dollar is highly leveraged to commodity markets, with perhaps the exception of energy. Because of this, pay attention to soft commodity such as grains and meats, as it can give you a bit of a heads up as to where we are going. Higher interest rates in the United States of course will continue to drive the US dollar higher in value, and I think that the market will continue to be very skittish as there are a lot of geopolitical concerns. Remember, the US dollar is the first place that traders will go to if geopolitical concerns ratchet up, which of course is going to be very possible, given the fact that the world is focused on trade wars, North Korea, Syria, and so many other bad things.