By RoboForex Analytical Department
The NZD/USD pair continues its downward trend, dropping to 0.6240 in its third consecutive session of declines. This ongoing sell-off in the New Zealand dollar is driven by market expectations of an upcoming interest rate cut by the Reserve Bank of New Zealand (RBNZ). New Zealand’s borrowing costs are currently at 5.25% per annum, with widespread anticipation of a 50-basis point reduction at the next RBNZ meeting.
The RBNZ is known for its proactive and flexible monetary policy, which swiftly adjusts to inflationary pressures and external economic indicators. This expected rate cut responds to such factors and aligns with the bank’s strategy to manage economic growth and inflation.
Moreover, the NZD has been under additional pressure from a strengthening US dollar, bolstered by unexpectedly robust US employment statistics for September, reported by ADP. Although the ADP report does not directly correlate with the Nonfarm Payrolls (NFP) due shortly, it still shapes market expectations and sentiment.
Global risk appetite has also waned significantly due to escalating geopolitical tensions in the Middle East, further dampening the prospects for growth-sensitive currencies like the NZD.
NZD/USD technical analysis
Free Reports:
The NZD/USD pair followed a bearish pattern, confirming a downward wave to 0.6265 and a corrective rise to 0.6313. The market is now forming a new decline towards 0.6210. Once this target is reached, a corrective move to retest 0.6265 from below may occur, potentially leading to further declines towards 0.6144. This bearish NZD/USD outlook is supported by the MACD indicator, which, despite being above zero, shows a strong downward trajectory.
On the hourly chart, the pair is developing the third wave of its decline towards 0.6210. Following this, a corrective fourth wave up to 0.6260 is anticipated. This forecast aligns with the Stochastic oscillator readings, which indicate the signal line is below 50 and heading towards 20, suggesting a continuation of the downward momentum after a brief correction.
Disclaimer
Any forecasts contained herein are based on the author’s particular opinion. This analysis may not be treated as trading advice. RoboForex bears no responsibility for trading results based on trading recommendations and reviews contained herein.
By Mustafa Aksoy, University at Albany, State University of New York Most CubeSats weigh less…
By Anna Nagurney, UMass Amherst Getting any product to consumers, whether it’s a can of…
By JustMarkets At the end of Wednesday, the Dow Jones Index (US30) gained 0.09%, while…
By JustMarkets At Tuesday’s close, the Dow Jones Index (US30) was down 0.41%, while the…
By ForexTime Escalating Middle East tensions rock markets Oil prices surge more than 5% Risk-off…
By RoboForex Analytical Department Brent crude oil prices climbed to 74.55 USD per barrel by…
This website uses cookies.