Currently, NZD/USD is trading at 0.7083, up 0.02% on the day, having posted a daily high at 0.7090 and low at 0.7079.
NZD/USD has been confined to a tight range while the bears take a breather within the descending trend from 0.7434 20th Sep highs to 0.7055 the recent low from the business done on the 9th October.
"Until the political clouds clear, markets will trade nervously, and with a mild downside bias. But even so, with the economy starting to show a few late-cycle wobbles and the RBNZ expected to be a reluctant participant in the global removal of monetary policy stimulus, any pop higher is something we would sell into," analysts at ANZ explained.
NZD/USD 1 day:
The analysts at Westpac expect further consolidation between 0.7050 and 0.7100 following a 5% fall over the past month and the recent stall in the USD.
NZD/USD 1-3 month:
Their forward outlook remains with the RBNZ which they expect to be firmly on hold and if the US dollar rises on the delivery of a Fed interest rate rise in December, then they say the NZD/USD could fall to 0.70 by year-end.
Within the vicinity of 0.7055, bears eye a break of the psychological 0.7000 level to target 0.6908, 11th April low. On the flipside, the bird needs to get through 0.7240 to confirm a significant correction is in place of which a break of 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.
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