NZD/USD: Next support below 0.6005 is at 0.5980 – UOB Group

FXStreet Insights Team FXStreet

There is still room for the New Zealand Dollar (NZD) to drop below 0.6000, UOB Group FX strategists Quek Ser Leang and Peter Chia note.

Set to drop towards 0.5980

24-HOUR VIEW: “Last Friday, when NZD was trading at 0.6045, we held the view that NZD ‘is likely to decline.’ We highlighted that ‘support levels are at 0.6030 and 0.6005.’ We also highlighted that ‘0.6005 is likely out of reach for now.’ Our view of NZD declining was correct. However, it dropped more than expected, almost reaching 0.6005 (low has been 0.6006). The rebound in early Asian trading today indicates slowing momentum. This, combined with oversold conditions, suggests that instead of continuing to weaken, NZD is more likely to trade in a sideways range of 0.6010/0.6045.”

1-3 WEEKS VIEW: “We highlighted last Wednesday (17 Jul, spot at 0.6070) ‘downward momentum is building, but not sufficiently enough to suggest the start of a sustained decline.’ After NZD dropped, we highlighted on Friday (19 Jul, spot at 0.6045) that ‘downward momentum has increased further, and the chance of NZD breaking below 0.6030 has also increased.’ We added, ‘the next level to watch below 0.6030 is 0.6005.’ NZD subsequently fell to a low of 0.6006. From here, oversold short-term conditions could lead to a couple of days of sideways trading. As long as 0.6070 (‘strong resistance’ level previously at 0.6085) is not breached, there is room for NZD to drop to and possibly below 0.6005. Looking ahead, the next support below 0.6005 is at 0.5980.”

Author

FXStreet Insights Team

FXStreet

The FXStreet Insights Team is a group of journalists that handpicks selected market observations published by renowned experts. The content includes notes by commercial as well as additional insights by internal and external analysts.

GBP/USD hits multi-week tops around 1.3560

GBP/USD gathers fresh steam and advances to new three-month peaks near the 1.3560 zone on Friday. Cable’s sharp move higher comes after three daily drops in a row and follows the increasing selling pressure hurting the Greenback.

EUR/USD pops to fresh two-month highs, targets 1.1600

EUR/USD advances markedly, revisiting the upper 1.1500s for the first time since mid-June. The pair’s sharp uptick comes on the back of a strong retracement in the US Dollar amid BoJ intervention chatter and despite steady uncertainty in the Middle East.

Gold picks up pace, approaches $4,400

Gold rebounds toward the $4,400 mark per troy ounce on Friday, reversing the previous day’s pullback. The precious metal’s recovery comes as fresh and intense weakness keep weighing on the US Dollar, while traders keep assessing easing expectations of an imminent Fed interest rate hike and the situation from the Middle East.

Pi Network Price Forecast: PI extends consolidation as bulls eye $0.10

Pi Network (PI) price holds steady on Friday, maintaining a consolidating tone for three consecutive days. Mild retail strength in the PI token remains stable, with Open Interest above $9 million, while social buzz eases. PI token’s technical outlook is mixed, as bearish momentum wanes to neutral, with bulls eyeing the $0.1000 psychological level.

Weekly focus: Some relief in US inflation concerns

Actual inflation data for July came out as expected with a 0.1% m/m increase in headline CPI and 0.2% excluding food and energy. Annual headline inflation remains too high at 3.4% and means that wage earners are experiencing stagnating spending power at best, and core inflation is a bit higher than the inflation target of two percent would suggest.

Why is Crude Oil priced for a reopening the ships haven't made?

Fourteen vessels crossed the Strait of Hormuz on Tuesday. Before the war, the count ran near 120 a day. In the sessions since the waterway was publicly declared open, Brent has drifted back to $87 and West Texas Intermediate (WTI) to $81, both a little lower again on Wednesday, with daily momentum on each unwound from the top of its range in late July to the low twenties now.