NZD/USD Fails Monthly High Test Again
The price of NZD/USD is approaching its weekly low (0.6137) after another failed attempt to test its monthly high (0.6276). The exchange rate may continue to bounce forex off the monthly low (0.6085) as it begins a series of higher highs and lower lows.
The NZD/USD pair fails to break the monthly high
The New Zealand dollar trades below its 200-day SMA (0.6162) as New Zealand’s gross domestic product (GDP) report shows a larger-than-expected decline in growth and the exchange rate may follow a negative sloping moving average as the dollar The US appears to be benefiting from a change in risk appetite.
Looking ahead, it remains to be seen if New Zealand’s 0.6% GDP cut will impact the Reserve Bank of New Zealand (RBNZ), with the central bank saying “core consumer price inflation remains too high” and Gov. Adrian Orr may again raise rates at the next meeting on April 4 as the November 2022 Monetary Policy Statement (MPS) shows a steeper trajectory for the official exchange base rate (OCR).
The Reserve Bank of New Zealand (RBNZ) says the OCR is expected to rise above 5% as part of ongoing inflation-fighting efforts, but the central bank could come under pressure to stop the bull cycle as New Zealand’s GDP report shows weakening growth. perspectives.
However, the NZD/USD pair may continue to depreciate in forex ahead of the Federal Reserve’s interest rate decision on March 22 amid an unsuccessful attempt to test the monthly high (0.6276), but the Fed’s events may affect the short-term outlook. for the exchange rate as the central bank has to update the SEP.
Daily NZD/USD chart
Source: StoneX, Tradingview
NZD/USD is starting a series of lower highs and lows in forex after failed attempts to test the monthly high (0.6276), with a break below the 200-day SMA (0.6162) increasing the likelihood of a move down to the March low. (0.6085).
The price of NZD/USD may follow the negative slope of the long-term moving average as the former support zone from 0.6260 (38.2% Fibonacci extension) to 0.6270 (38.2% Fibonacci retracement) appears to be acting as resistance, with move below the March low (0.6085), opening the 0.6070 area (61.8% Fibonacci extension).
However, NZD/USD could face range conditions if it defends the monthly low (0.6085) with a move above 0.6220 (50% Fibonacci extension), extending the area from 0.6260 (Fibonacci extension 50%). 38.2%) to 0.6270 (38.2% Fibonacci retracement level). .
David Song, Strategist, FOREX.com » Official site
David Song has over 15 years of experience trading currencies, researching commodities and stock indices. He studied macroeconomic policy under a visiting scholar at the Federal Reserve Bank of St. Louis and gained in-depth knowledge of technical analysis from the former president of the Market Professionals Association.
Disclaimer: The information and opinions contained in this report are for general information only and do not constitute an offer or solicitation to buy or sell any currency contracts or CFDs. Although the information contained herein has been obtained from sources believed to be reliable, the author does not warrant its accuracy or completeness and shall not be liable for any direct, indirect or consequential damages that may result from anyone relying on such information.