NZD has been traded in a broad lateral trend against the US dollar.
In early March, the pair again reached a local minimum at 0.7185, after which a new upward wave was formed. But after testing 0.7355 mark, the pair dropped sharply to the lower border of the channel (0.7220). The main catalyst for the decline was the growth of USD in view of favorable statistics on labor market and major indices. The RBNZ comments on a soft monetary policy put pressure on the NZD for a long time.
Today, the downward momentum was maintained on weak data on the index of business activity in the manufacturing sector of New Zealand. Attention should be paid to data on the construction sector and industrial production in the USA.
Support and resistance
In the short term, the pair is expected to further decline to the levels of 0.7220, 0.7200, from which the upward trend may resume. In the medium term, one can expect the return of the instrument to local highs of the end of January with a high probability of breaking them. Next week, RBNZ will publish a decision on interest rates and prospects for economic development for H1 2018. The US Fed will publish a decision on the rates with the FOMC statement, the data on the labor market and orders for durable goods.
Technical indicators on H4 chart indicate downward dynamics: MACD shows a sharp surge in the volume of short positions, Bollinger Bands did not reverse but significantly broadened.
Support levels: 0.7250, 0.7220, 0.7200, 0.7185, 0.7150, 0.7100.
Resistance levels: 0.7275, 0.7285, 0.7295, 0.7310, 0.7335, 0.7355, 0.7370.
Deferred long positions may be opened from levels of 0.7220, 0.7200 with the target at 0.7370 and stop-loss at 0.7160.
New Zealand Dollar vs US Dollar
|Entry Point||0.7220, 0.7200|
|Support levels||0.7100, 0.7150, 0.7185, 0.7200, 0.7250, 0.7220, 0.7275, 0.7285, 0.7295, 0.7310, 0.7335, 0.7355, 0.7370|
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