Time Zone: GMT +2
Time Frame: 4 Hours (H4)
Fundamental Analysis:
The NZD/USD forex pair is currently facing significant market influences, driven by both New Zealand and U.S. economic data releases. Today, key U.S. reports, including the JOLTS Job Openings (expected 8.01M, prior 8.10M) and Factory Orders m/m (-0.7% expected, previous -0.4%), will provide insight into the U.S. labor market and manufacturing sector. Additionally, speeches by FOMC members Bostic and Daly could impact USD sentiment, particularly if they hint at future monetary policy changes.
On the New Zealand side, the GDT Price Index (forecasted at 1.4%) and Employment Change q/q (-0.2% expected, prior -0.5%) will play a key role in determining NZD movement. The Unemployment Rate is expected to rise to 5.1% from 4.8%, indicating potential labor market weakness, which may add bearish pressure on the NZD. Given these factors, the NZDUSD fx pair could experience increased volatility, with a higher probability of USD strength dominating the market.
Price Action:
After a strong bearish trend, NZD/USD has attempted a retest of the lost support zone in the form of a bullish correction. The price is currently trading around 0.56100, which aligns with an immediate resistance level. If this level holds, the NZD-USD pair could resume its downward movement. The recent price action shows a series of lower highs and lower lows, reinforcing the bearish structure. A failure to break above 0.56570 would likely push the NZD USD pair toward lower support levels.
Key Technical Indicators:
Relative Strength Index (RSI): The RSI is currently at 40, signaling a bearish trend. This indicates that sellers are in control, but there is still room for further downside before entering oversold territory. If the RSI drops below 30, it could suggest an oversold condition, potentially leading to a short-term reversal or consolidation.
Volume Indicator: The volume indicator is showing a positive reaction to the bearish phase, reinforcing the possibility of a continued downward trend. Increased selling volume suggests that bearish sentiment remains strong, reducing the likelihood of a sustained bullish correction.
Support and Resistance:
Support: Immediate support levels are identified at 0.55430, 0.55160, and 0.55000. These levels could be considered as targets for the upcoming bearish wave.
Resistance: Resistance levels are located at 0.56100, 0.56570, and 0.57250. Any sustained break above these levels would invalidate the bearish scenario.
Conclusion and Consideration:
The NZD/USD pair remains in a bearish structure, supported by key technical indicators, including RSI, volume, and MACD. The recent price action suggests that the bearish correction phase could continue if resistance at 0.56100 holds. Upcoming economic events, particularly U.S. labor market data and New Zealand employment reports, will play a crucial role in determining short-term price action. Traders should closely monitor resistance and support levels for potential breakout or continuation signals.
Disclaimer: The analysis provided for NZD/USD is for informational purposes only and does not constitute investment advice. Traders are encouraged to perform their own analysis and research before making any trading decisions on NZDUSD. Market conditions can change quickly, so staying informed with the latest data is essential.
