NZD/USD: downside finally playing out, target 0.68 medium term
|Currently, NZD/USD is trading at 0.7129, down -0.13% on the day, having posted a daily high at 0.7142 and low at 0.7123.
Fed's Beige Book: Majority of Fed districts described labor markets as tight
NZD/USD dropped today on the back of Yellen's hawkishness and broad based dollar strength that has come back into play ahead of Trump's inauguration.
Analysts at Westpac explained that it appears to have found a short term peak just above 0.72 while on the downside NZD should find some intraday support around 0.7150.
Fed's Yellen expects rates to be close to longer-run neutral rate of 3 pct by end of 2019
NZD/USD 1-3 month:
The analysts expect the kiwi to drop lower to 0.6800 in the medium term. "The US dollar has had an impressive rise since the US election and has potential to rise further during the months ahead. The Fed’s assertive tightening projections plus US fiscal expansion should maintain upside pressure on US interest rates and the US dollar. Against that, the NZ economy is strong and dairy prices have risen, but these forces are subservient to the US dollar’s trend."
NZD/USD levels
Spot is presently trading at 0.7130, and next resistance can be seen at 0.7130 (Daily Classic S1), 0.7132 (Yesterday's Low), 0.7139 (Daily Open), 0.7141 (Hourly 100 SMA) and 0.7142 (Daily High). Support below can be found at 0.7123 (Daily Low), 0.7089 (Daily 200 SMA), 0.7077 (Hourly 200 SMA), 0.7073 (Weekly Classic PP) and 0.7056 (Daily Classic S2).
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