The NZD/USD is trading near the 0.61670 mark as of this writing and this value should be double-checked as you read this article to see where the currency pair is traversing in real-time. The NZD/USD has proven remarkably choppy the past week of trading, showing strong signs of moves higher, but then followed by rather stiff selloffs.
A high of nearly 0.62475 was produced last Friday, this as traders continued to seemingly react to the news the U.S. Federal Reserve would not hike its interest rate in June. Yesterday’s trading in the NZD/USD began to produce a reversal lower again however, and the current value of the currency pair is lingering below values seen last Wednesday just before the Fed’s announcement. Technical day traders are likely running into whipsaw results which are proving expensive if they have not been using solid risk management while pursuing quick-hitting trades.
Recession and Inflation Concerns Grip New Zealand and has an effect on the NZD/USD
While day trading has proven complex for the NZD/USD via a five days trading chart, a one-month technical perspective does seem to offer some hope. The NZD/USD has correlated to the broad Forex market and turned into a rather bullish trend since the start of June. Yet daily results may be proving troublesome to wager on for speculators using too much leverage and when timeframes do not include the possibility of holding trading overnight.
While inflation remains high in New Zealand and recessionary economic data have been seen, the NZD/USD does have a shadow over its value. However, the power of the USD and U.S Federal Reserve does play a major part in the value of the New Zealand Dollar. And while the short-term may prove to be difficult, long-term viewpoints may still be clinging to the notion the NZD/USD should rise in value. However, the U.S Fed remains rather murky regarding its interest rate outlook and has threatened to raise the Federal Funds Rate in July.
NZD/USD Short-Term Resistance Levels of 0.61800 and 0.61900 are Targets
- Traders who want to pursue upwards price action in the NZD/USD cannot be blamed, but they might want to wait for support levels to be tested before they launch their buying positions.
- The short-term resistance above should be watched carefully, if the 0.61900 mark is challenged it might set off another test of the 0.62000 level in the near term.
- The NZD/USD will be influenced potentially by testimony from Fed Chairman Jerome Powell on Wednesday and Thursday as he speaks with Congressional committees.
NZD/USD Short-Term Outlook:
Current Resistance: 0.61750
Current Support: 0.61625
High Target: 0.62325
Low Target: 0.61520
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