A Strong 3-Week Recovery
The NZDUSD is up for the third week in a row after bottoming on November 21 at 0.55758. The move to the upside has taken the pair to a high this week of 0.5830, representing a significant recovery over the last 16 trading days:
Price Change: +254 pips
Percentage Change: +4.56%
The Technical Battle: 100-Day Moving Average
This week's rally briefly extended above the 100-day moving average at 0.58025—the first time price has traded above this level since September 18. However, the momentum hit a wall near a cluster of key resistance levels.
Where Sellers Stepped In: The run to the upside stalled near the low of a swing area between 0.5830 and 0.58442. Crucially, it also failed just ahead of the 50% midpoint of the move from the July 1 high to the November low, which comes in at 0.58476.
After reaching a high of 0.5830 yesterday, sellers leaned against resistance and pushed the price modestly lower. While the pair dipped back below the 100-day moving average, the decline stalled ahead of the broken 38.2% retracement level at 0.5783.
Current Setup & Key Levels
Heading into the end of the week and the new trading session, traders will be treating the 100-day moving average (0.58025) and the 0.5800 natural level as the barometer for the next directional move.
The Bullish Scenario (Topside Targets):
Buyers need to push back above 0.5830 and clear the 0.58476 (50% midpoint) level to gain confidence.
A break above that zone would have traders looking toward the 200-day moving average at 0.58677 as a major confirming signal for a sustained bullish trend.
The Bearish Scenario (Downside Risks):
If the tilt shifts to the downside and price breaks back below the 38.2% retracement at 0.5783, the bias weakens.
Traders would then target the swing area at 0.5753, followed by the rising 100-bar moving average on the 4-hour chart at 0.5722.
Watch the Video Analysis: In the video above, I (Greg Michalowski, author of Attacking Currency Trends) break down the technical factors driving the move, outline where the risk is, and map out the next targets that matter most for NZDUSD traders.
Be aware. Be prepared.
