As of this writing the NZD/USD is near the 0.57470 ratio which appears to actually be an important level for intraday speculators as the 0.57500 seems to be a key psychological level.
In early trading this morning the NZD/USD traversed a high slightly above the 0.57600 ratio, but since then has seen some selling develop. The NZD/USD fell below the 0.57500 mark again and current trading appears to be using this vicinity as an inflection point taking into consideration trading since the 9th of October. The 0.57500 level in the NZD/USD has proven difficult to sustain higher recently.
The morning’s early rush higher from an optimistic bullish standpoint was able to achieve a high not seen since the 9th of October. Intriguingly, on the 10th of October was when President Trump increased his anti-China trade rhetoric and sent the broad financial markets into a volatile cycle – particularly in Forex the move downwards for the NZD/USD gained price velocity. The ability of the NZD/USD to move higher this morning shows that sentiment appears to be leaning into the hope the currency pair will move higher by financial institutions.
Fed’s Interest Rate Cut Factored into NZD/USD
However, before a day trader decides to try and step out in front of the price action in the NZD/USD and speculate on a trend higher before it emerges, they should consider the U.S Fed’s interest rate cut which is anticipated next week has likely been factored into the currency pair already. Meaning it will take additional bullish optimism and a bit of risk taking to wager on NZD/USD value increasing.
Technically the NZD/USD remains within the lower part of its six month technical range. The currency pair has not been able to muster any price action higher in a sustained manner, and in fact has seen selling pressure become rather consistent. Before a day trader decides to latch onto the notion the NZD/USD can create momentum upwards they might want to see important ratios see sustained price action. The 0.57500 is a well defined level to watch today and action above 0.57600 for more than a couple of days would be significant.
O.57500 a Key Near-Term Barometer
The broad Forex market has been choppy and this is likely to continue the remainder of this week. Risk appetite while still showing signs of aggressiveness with equity indices is also producing cautious results which have not allowed for sustained one way price action.
- The NZD/USD is likely to continue to face headwinds in the near-term until further positive impetus develops.
- Other major currencies teamed against the USD are showing similar results as price action remains skittish.
- Day traders in the short and near-term should keep their eyes on barometers like the 0.57500 to see if it can be challenged again and exhibit sustained value.
- If the NZD/USD fails to do this then it is likely the currency pair will languish within a price realm that needs to be wagered upon using quick hitting targets that take advantage of a range between 0.57350 and 0.57500.
NZD/USD Short Term Outlook:
Current Resistance: 0.57490
Current Support: 0.57440
High Target: 0.57590
Low Target: 0.57325
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