The NZD/USD dropped today and failed to reach a major dynamic resistance. Price has found temporary resistance, remains to see if this will be a larger drop or it will come back higher after a minor drop. The USD has taken control even if the USDX has dropped today and has tried to resume the yesterday’s bearish candle.

The rate will drop further if the USDX will have enough energy to climb much higher in the upcoming days. Technically, a failure to reach the near term dynamic resistance will signal an exhaustion and a potential drop.

Remains to see how the Kiwi will react later, after the New Zeland data will be released, the Current Account may drop further, from -0.62B to -4.22B, the Visitor Arrivals will be released as well, but I don’t believe that will have a significant impact. The Trade Balance could bring some action as well, the deficit could increase from -871M to -495M, a better report will boost the Kiwi, which will appreciate versus all its rivals and not only against the greenback. The NZD dropped even if the New Zealand ANZ Business Confidence increased from -39.3 to -37.8 points in the early morning. The USD increase also because the United States data have come in better earlier.

The NZD/USD dropped and failed to stay above the median line (ml) of the minor ascending pitchfork, but most important has failed to reach the third warning line (WL3) of the descending pitchfork. It could reach the 23.6% retracement level in the upcoming hours if the New Zealand data will disappoint.

It could be attracted by the lower median line (lml) of the ascending pitchfork if will stabilize below the median line (ml).

A further increase will appear after a valid breakout above the WL3, some good economic data could send the NZD/USD much above the mentioned resistance level. I really hope that we’ll have a clear direction very soon.