The NZD/USD has achieved new lows in early trading this morning as values have tested the 0.60000 juncture. The last time prices of the USD/NZD currency pair tested its current depths was during the height of coronavirus worries from March until May of 2020. Before the coronavirus saga, the NZD/USD had not traded near these current price ratios since late 2008 and into early 2009 during the financial crisis.
Some Speculators may believe the worst is over for the New Zealand Dollar
As of this writing the NZD/USD is near 0.60010, because of the choppy conditions traders should compare this written price to market values as they read. Earlier this morning New Zealand posted Gross Domestic Product data which came in better than expected, but this did not seem to create any long lasting bullish momentum for the NZD/USD. This morning has seen new lows demonstrated and important psychological support come into view.
Some traders may continue to test the downward momentum within the NZD/USD with the expectation reversals upward need to occur and be sustained. However, the Forex market continues to demonstrate the strength of the USD against many major currencies. While it might be true the NZD/USD is within the lower elements of its long term trading range, it doesn’t mean the currency pair’s bearish trend is about to end.
Nervous Global Markets are not helping the NZD/USD sustain higher values
Inflation data from the U.S continues to fuel poor behavioral sentiment within the global markets. The NZD/USD is not immune to worries regarding the interest rate policy of the U.S Federal Reserve. While next week’s interest rate hike has been factored into trading of the NZD/USD, it is the outlook of the U.S central into spring of next year which is causing a storm. High inflation data from U.S CPI results earlier this week showed that higher prices remain troubling.
- NZD/USD traders should keep their eyes on the 0.60000 support realm, if it is challenged and falters lower moves to 0.59800 are not out of the question.
- If support levels crumble and trading is sustained below the 0.60000 ratio, this could set off another leg downwards, but traders need to be ready for choppy and fast conditions.
Looking for upside movement via short reversals higher might be tempting for contrarian traders, but they could prove very dangerous too. Under the present trading environment traders should keep their ambitions realistic with rather close take profit goals. The near term will remain dangerous for the NZD/USD and next week’s looming U.S Federal Reserve pronouncements are certain to inspire dynamic results.
NZD/USD Short Term Outlook:
Current Resistance: 0.60149
Current Support: 0.60001
High Target: 0.60257
Low Target: 0.58750
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