New Zealand Currency is significantly falling against the US dollar after the interest rate decision and RBNZ Statement upon the maintenance of the mild monetary policy in the long term.
In the middle of the last week in RBNZ statement was claimed that the key interest rate will stay on the same level, so the monetary policy perspectives are unclear. It was also noted, that low rate of the national currency is necessary to increase the inflation rate.
Today the pair rapidly went down, breaking few of the key support levels. Poor Business NZ PMI, Producer Price Index – Input and Output data affected the pair negatively. The pair has lost 100 points in a few hours, and downward momentum maintains.
As there is lack of US key releases in the economical calendar, the pair will move according to the trading moods.
Support and resistance
The pair will fall to the key levels of 0.6770, 0.6680, 0.6575. Insignificant upward correction at the level of 0.6770 with the target at 0.6820 is possible, but after it the pair will decrease further. Technical indicators confirms the forecast, MACD reflects the growth of short positions volumes, Bollinger Bands are pointed downwards.
Resistance levels: 0.6820, 0.6875, 0.6920, 0.6975, 0.7010, 0.7050.
Support levels: 0.6770, 0.6730, 0.6680, 0.6575, 0.6500.
It’s better to increase the volume of short positions at the current level with the targets at 0.6770, 0.6680, 0.6575 and stop loss at 0.6860.