A deepening economic downturn in New Zealand paired with expectations for a rate cut by the RBNZ continues to favor a bearish outlook for the NZDUSD, and the pair is likely to retest the February low next month as investors remain risk adverse.
Currency Pair: NZD/USD
Chart: 60 Min Charts
Short-Term Bias: Bearish
Analysis
A deepening economic downturn in New Zealand paired with expectations for a rate cut by the RBNZ continues to favor a bearish outlook for the NZDUSD, and the pair is likely to retest the February low next month as investors remain risk adverse. After reaching a high of 0.6086 in December, increased selling pressures dragged the pair to a seven-year low of 0.4961 earlier this month, and the lack of momentum to push back above 0.5520-30 (50.0% Fib) should hold the kiwi-dollar in a downward trend over the near-term. As a result, I expect the NZDUSD to fall lower over the following week however, as the RSI approaches oversold territory, we may see the pair attempt to push higher over the next few hours of trading to fill-in the gap from the 120 SMA. Be sure to check out other Technical Reports from DailyFX for additional information on the major currency pairs.
To contact the author of this article, please email: dsong@fxcm.com
Related Articles:
Taking A Short Term Range In Long Term USDCAD Congestion
Dollar / Yen Enters Fibonacci Resistance Zone
New Zealand Dollar / US Dollar Breakout Imminent, Downside Favored
Japanese Yen Forecast to Fall Further on Forex Trading Sentiment
