The NZD/USD has traded to higher ground in early speculative price action this morning, the move upwards largely occurred after the New Zealand Reserve Bank’s rate decision.
- The Reserve Bank of New Zealand did not change its monetary earlier today and in the wake of the inaction financial institutions began buying the NZD/USD.
- The currency pair is near the 0.60700 mark as to this writing. Price velocity has been quick and traders should brace themselves for a bit longer, because U.S inflation data will be published today and tomorrow which will shake the NZD/USD.
The move higher from lows which were seen on Friday of last week around the 0.59860 level has been noticeable in the NZD/USD. However, the upwards price action has reflected the broad Forex market as the USD has lost some momentum. Having said the USD has lost some strength though should be considered as timeframe perspective. While the near-term has produced upwards momentum in the NZD/USD, the currency pair was touching 0.62185 realms on the 8th of March.
Speculative Conditions and Price Velocity in the NZD/USD
Speculators of the NZD/USD got a boost of bullish confidence additionally this morning because of the RBNZ’s decision to sit on their hands. The better than expected jobs numbers from the U.S last week were important because on the surface the data looked good, but as financial institutions studied the statistics they likely saw cracks beneath the headlines. Most hiring was done by the U.S government and many of the jobs were part-time hires.
The ability of the NZD/USD to climb from the lows of last Friday, which seemed to have found rather durable support around the 0.59900 mark (even though the low was 0.59875 thereabouts), showed technically financial institutions seem to believe this may be a bottom level for the currency pair. Today and tomorrow’s trading will take on importance and react to the U.S inflation numbers certainly.
Consumer Price Index Today and PPI Tomorrow from the U.S
If inflation numbers come in weaker in the U.S this could spark additional buying of the NZD/USD. However traders need to remember last month’s CPI statistics didn’t cause much of a storm, but higher Producer Price Index data the following day set off volatility in the NZD/USD. Traders need to prepare their risk taking with carefully planned strategies if they want to pursue the currency pair as the inflation data hits today and tomorrow.
- As the NZD/USD trades near highs, bullish ambitions may be enticing but speculators should be willing to cash out profits before they vanish.
- The price range in the NZD/USD is certain to get wider today and tomorrow. If U.S inflation is weaker, the 0.61000 ratio could become a target, but that may be too far a step for day traders to wager on.
- If inflation data is weaker the 0.60000 support level could become vulnerable again.
NZD/USD Short Term Outlook:
Current Resistance: 0.60820
Current Support: 0.60550
High Target: 0.61095
Low Target: 0.59970
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