NZD/USD Forecast: Slams into Resistance

The NZD/USD has been all over the place during the session on Thursday, as we continue to see a lot of noisy behavior. At this point, the market has been both bearish and bullish during the day, but it seems like the 0.64 level is going to continue to show its importance. The market had been waiting for the Consumer Price Index to come out, and as it gave the market exactly what the market had anticipated, it read into that that perhaps the Federal Reserve was going to be a little bit calmer with its monetary tightening, but at this point, I think is very unlikely that a whole lot has changed. However, there are some out there betting that the Federal Reserve will only raise interest rates by 25 basis points instead of the 50 basis points feared.

Advertisement

Take advantage of today's market opportunities

START TRADING NOW

Looking at this chart, it’s obvious that there is a significant amount of resistance between the 0.64 and the 0.65 level, so the fact that we stayed there is probably not a huge surprise. We did pierce it for a while, and it looked like the US dollar was about to be eviscerated. The Euro broke out to a fresh high, but the New Zealand dollar could not follow along with it. This is an interesting turn of events because it could be showing that the New Zealand dollar is going to lag other currencies.

NZD Would be the First to Sell Off if We Get a Turnaround

• If that’s going to be the case, then it stands to reason that perhaps the New Zealand dollar will be the first to sell off if we get a turnaround.
• After all, if it couldn’t follow right along with the Arrow and the Aussie, that means something isn’t quite right here.
• The other way to look at that is that perhaps if the Euro really starts to take off, then it’s possible that the New Zealand dollar needs to play catch-up.

It’s a little early to call this, but I would say that stopping where we do leave quite a bit of doubt in the market. This is great, because the one thing that we needed in the currency markets after the last 2 months, was much more in the way of doubt. After all, we haven’t had clarity for ages, as traders continue to beat each other up over the idea of whether Uncle Jerome will liquefy everything.

Ready to trade our Forex daily analysis and predictions? Here are the best new Zealand forex brokers to choose from.