Quick Overview:
- The NZD/USD pair is moving upward, driven by improved market risk sentiment.
- Softer US inflation figures hint at rate cuts, weakening the USD despite a hawkish FOMC stance.
- Key support at 0.6082 and resistance at 0.6217; technical traders closely watch these levels.
The NZD/USD pair has gradually increased from last week’s lows. This positive shift has helped the New Zealand Dollar gain traction against the US Dollar (USD), reversing some of the recent downward pressure and setting a more optimistic tone for future performance.
NZD/USD Bounces Near 0.6082 Support, Eyes 0.6217
The US Dollar has experienced a general weakening this week, following a period of strength last week. This shift comes from softer inflation figures in the US, which have reinforced market expectations of two interest rate cuts within the year. Despite this, the Federal Open Market Committee (FOMC) delivered a marginally more hawkish decision than anticipated, adding a layer of complexity to the USD’s performance and keeping traders on their toes.
On the other hand, the New Zealand Dollar has been under pressure due to risk-off sentiment and the prevailing strength of the US Dollar. However, improving market mood has allowed the NZD to regain some ground. Additionally, the first quarter GDP figures for New Zealand indicated positive growth, pulling the country out of a technical recession. Although GDP data is not typically a strong market-moving catalyst, it confirms a pickup in growth, which has provided some support for the NZD and bolstered investor confidence.
New Zealand Dollar Range-Bound Between 0.6082 and 0.6217
The NZD/USD pair bounced near a key support level of 0.6082 on the daily chart. This level aligns with the 38.2% Fibonacci retracement, making it a significant point for technical traders. Buyers are now targeting a rally towards the 0.6217 resistance level. However, sellers are expected to position themselves above this resistance, aiming to push the price back to the lower end of the range, creating a dynamic and closely watched battle.
In the four-hour chart, the price action has been range-bound between the 0.6082 support and 0.6217 resistance. These key levels must be broken for a more sustained trend to develop. Traders are closely watching these points to gauge the next significant move in the pair. This tight range indicates a period of consolidation, with market participants waiting for a clearer signal before committing to a direction.
NZD/USD Faces 0.6145 Resistance in Short-Term
The one-hour chart highlights strong resistance at the 0.6145 level. Buyers aim for a break higher towards the 0.6217 resistance. However, sellers are leaning on the 0.6145 level to position for a potential drop back to the 0.6082 support. The average daily range for today is defined by these red lines, providing a clear framework for short-term traders and highlighting the importance of these key levels in the near term.
Upcoming economic data releases that could impact the NZD/USD pair include US Housing Starts, Building Permits, and Jobless Claims figures. Additionally, market participants will closely watch US PMIs scheduled for tomorrow. These data points could provide further direction for the pair, making them critical to watch for anyone trading this pair.
Bearish Trend Holds NZD/USD Below 0.6140
As of 21 June 2024, the NZD/USD pair shows calm negativity, moving away from the 0.6140 level. The expected bearish trend will likely continue, with the next main target set at 0.6070. Negative pressure from the EMA50 supports this target. If the pair remains below the 0.6140 level, analysts expect the bearish trend conditions to hold, reinforcing the negative outlook.
The expected trading range for the NZD/USD pair is between the support level of 0.6060 and the resistance level of 0.6260. The overall trend forecast remains bearish, suggesting further downside potential in the near term. Depending on the evolving market conditions, this range provides traders with clear markers for potential entry and exit points.
