The NZD/USD is near the 0.59350 level as of the is writing, a high of nearly 0.60010 was seen on early Monday which sustained and surpassed (slightly) apex values created before going into the weekend. However, yesterday’s trading in the NZD/USD saw headwinds develop as the currency pair’s embrace of highs not seen since the 12th of October began to decline.
The NZD/USD is still slightly above the middle ground of its one month technical chart, but bullish traders looking for upside momentum have been stung by reversals lower from the currency pair frequently since the middle of July. Having achieved a monthly high was a good accomplishment for the NZD/USD, but the question is about sustainability of the trend and where exactly can support prove it is durable this time around.
NZD/USD Climb Above 0.59000 is Significant if Value Stays Strong
Risk adverse conditions remain strong in the global markets, but some risk appetite has shown an ability to create buying within U.S equities recently. U.S Treasuries remain a key element in trading and Forex, not surprisingly, and likely not a coincidence is the slight uptick in bond yields yesterday helping fuel a stronger USD throughout the day within most major currency pairs including the NZD/USD.
The push above the 0.59000 last Thursday and ability to attack the 0.60000 with solid price velocity on Friday was good for the NZD/USD bulls. This occurred as the U.S jobs numbers came in worse than anticipated. However, for the NZD/USD to traverse higher again and start challenging resistance levels another dose of impetus will likely have to happen in the broad markets. Meaning risk appetite will have to remain stable and improve.
Global risk concerns regarding the potential for ‘loud’ developing news remains problematic. Financial institutions though seem to have digested the Middle East news for the moment. A sign of this is that gold has decreased in value the past few days incrementally. Bullish traders will want to see the 0.59300 level can be maintained in the short-term and that no retest of the 0.59000 penetrates to even lower depths.
Risk via U.S Federal Reserve Rhetoric and Economic Data End of this Week
- Fed Chairman Jerome Powell will speak today at a conference in Washington D.C and other Fed officials are schedule to speak at various events too. However, they will likely not want to deliver and major surprises today.
- This coming Friday the U.S will see a Consumer Sentiment reading from the University of Michigan. The data result could affect Forex.
- The short and near-term are likely to remain under a cloud of behavioral sentiment. If conditions remain calm, the NZD/USD could be an attractive currency pair to wager on upside.
NZD/USD Short Term Outlook:
Current Resistance: 0.59445
Current Support: 0.59300
High Target: 0.59825
Low Target: 0.59010
Ready to trade our daily Forex analysis? Here's a list of the brokers for forex trading in New Zealand to choose from.