|

NZD/USD: en-route for a major correction?

Currently, NZD/USD is trading at 0.7144, up 0.87% on the day, having posted a daily high at 0.7147 and low at 0.7079.

NZD/USD has stayed with the bid having made a fresh high for the week overnight in a short squeeze onto the 0.71 handle. US yields and the dollar were whacked as a result of the mixed messages from the FOMC minutes that had something for both the hawks and doves. 

NZD: Big changes? - Rabobank

However, the FX space has trimmed the long dollar position and has given rise to a demand for the higher betas that were consolidating at the bottom of their bearish ranges this week. Still, the hung parliament conditions in NZ is a weight on the bird and the price is meeting the break-out a point for the 3rd October. However, the NZ government decision is expected by end of next week. "The announcement of the government composition will probably cause a kneejerk response in the NZD - up for National, down for Labour – after which the direction of the US dollar will dominate", according to Imre Speizer, a Research Analyst at Westpac.

NZD/USD levels

Above 0.7150, the bird really needs to get through 0.7240 to confirm that a significant correction of the 20th Sep highs is in place - a subsequent break of there could open doors towards 0.7315. 0.7370 (the 9th Aug high) is the next key hurdle on the upside and a break there would solidify a bullish trend back towards 0.7522 and the YTD highs so long as there are closes on the 0.74 handle and beyond the post FOMC kneejerk highs of 0.7434. To the downside, 0.7052, a 19-week low, guards the psychological 0.7000 level to target 0.6908, 11th April low. 

Author

Ross J Burland

Ross J Burland, born in England, UK, is a sportsman at heart. He played Rugby and Judo for his county, Kent and the South East of England Rugby team.

More from Ross J Burland
Share:

Editor's Picks

EUR/USD holds steady above 1.1850 as markets eye Eurozone GDP, US CPI inflation releases

The EUR/USD pair trades on a flat note near 1.1870 during the early Asian session on Friday. The major pair steadies amid mixed signals from the latest release of US economic indicators. Traders await the preliminary reading of the Eurozone Gross Domestic Product for the fourth quarter and US inflation data, which are published later on Friday.  

GBP/USD consolidates around 1.3600 vs. USD; looks to US CPI for fresh impetus

The GBP/USD pair remains on the defensive through the Asian session on Friday, though it lacks bearish conviction and holds above the 1.3600 mark as traders await the release of the US consumer inflation figures before placing directional bets.

Gold: Will US CPI data trigger a range breakout?

Gold retakes $5,000 early Friday amid a turnaround from weekly lows as US CPI data loom. The US Dollar consolidates weekly losses as AI concerns-driven risk-off mood stalls downside. Technically, Gold appears primed for a big range breakout, with risks skewed toward a bullish break.

Top Crypto Gainers: River faces resistance, Humanity Protocol steadies, Polygon rebounds

Altcoins, including River, Humanity Protocol and Polygon, rank as top-performing cryptocurrencies in the last 24 hours, defying the broader market pullback as Bitcoin dropped below $67,000.

A tale of two labour markets: Headline strength masks underlying weakness

Undoubtedly, yesterday’s delayed US January jobs report delivered a strong headline – one that surpassed most estimates. However, optimism quickly faded amid sobering benchmark revisions.

Aster Price Forecast: Demand sparks on Binance Wallet partnership for on-chain perpetuals

Aster is up roughly 9% so far on Thursday, hinting at the breakout of a crucial resistance level. Aster partners up with Binance wallet for the second season of the on-chain perpetuals challenge.