Over the past month, NZDUSD has been charging on with the bulls in control. However, the pair may be losing steam as it reaches a post-breakout Fibonacci level at the 1.618. Should the pair retrace in this instance, it may find support at the 618 retracement around 0.67500, before continuing upwards.
This week we will witness either a consolidation of the price between 0.70000 and 0.71000 or a retracement down to the 0.67500 level as investors take their profits from those levels and the bears take temporary control of the market. Regardless of which way it goes, the NZDUSD looks to post even further highs with the current overall market sentiment.
The US Dollar Index, which tracks the US Dollar against other foreign currencies, lowered to 90.653 on Friday. However, with its closing at 90.970, we may see a temporary strengthening of the US Dollar which will help drive down the NZDUSD. Further speculation of the results of the upcoming FOMC meeting presenting a dovish outlook may continue to prop up this pair further.
