Select Language

NZD/USD Price Forecast: 0.6000 acts as key support

blockHeadVisual
  1. HOME
  2. Get information
  3. World FX news
  4. NZD/USD Price Forecast: 0.6000 acts as key support

World FX news

search
Breaking news

NZD/USD Price Forecast: 0.6000 acts as key support

  • X
  • facebook
  • LINE
  • RSS
  • X
  • facebook
  • LINE
  • RSS
New update 2024.10.24 18:55
NZD/USD Price Forecast: 0.6000 acts as key support

update 2024.10.24 18:55

  • NZD/USD finds fresh buying interest near 0.6000, while the near-term trend remains bearish.
  • The US Dollar's outlook remains firm due to multiple tailwinds.
  • Traders expect the RBNZ to cut interest rates again by 50 bps in November.

The NZD/USD pair bounces back from the psychological support of 0.6000 in Thursday's European session. The Kiwi pair rebounds as the US Dollar (USD) corrects after posting a fresh high in 12 weeks. The US Dollar Index (DXY) faces pressure while attempting to break above the key resistance of 104.50.

The US Dollar could resume its upside trend amid uncertainty over United States (US) 2024 presidential elections. Meanwhile, the recent rally in the Greenback suggests that trades price in former US President Donald Trump's victory over current Vice President Kamala Harris.

The US Dollar has also benefitted from growing expectations that the Federal Reserve (Fed) will pursue a modest interest rate cut path.

Meanwhile, the New Zealand Dollar (NZD) is expected to remain weak as traders have priced in 50 basis points (bps) interest rate reduction from the Reserve Bank of New Zealand (RBNZ) in its last meeting of the year on November 27, a similar move seen on October 9. This would be the third straight interest rate cut by the RBNZ in a row.

NZD/USD finds a temporary support near 0.6000. However, the outlook of the Kiwi pair remains weak as it trades below the 61.8% Fibonacci retracement around 0.6050. The Fibo tool is plotted from the July 29 low at 0.5857 to the September 30 high at 0.6380.

Downward-sloping 20- and 50-day Exponential Moving Averages (EMAs) near 0.6100 and 0.6130, respectively, suggests more weakness ahead.

The 14-day Relative Strength Index (RSI) oscillates below 40.00, indicating a strong bearish momentum.

More downside is highly likely towards the August 15 low of 0.5974 and the round-level support of 0.5900 if the pair decisively breaks below the psychological support of 0.6000.

On the flip side, a reversal move above the October 8 high of 0.6146 will drive the asset towards the 50-day EMA at 0.6173 and the October 4 high near 0.6220.

NZD/USD daily chart

New Zealand Dollar FAQs

The New Zealand Dollar (NZD), also known as the Kiwi, is a well-known traded currency among investors. Its value is broadly determined by the health of the New Zealand economy and the country's central bank policy. Still, there are some unique particularities that also can make NZD move. The performance of the Chinese economy tends to move the Kiwi because China is New Zealand's biggest trading partner. Bad news for the Chinese economy likely means less New Zealand exports to the country, hitting the economy and thus its currency. Another factor moving NZD is dairy prices as the dairy industry is New Zealand's main export. High dairy prices boost export income, contributing positively to the economy and thus to the NZD.

The Reserve Bank of New Zealand (RBNZ) aims to achieve and maintain an inflation rate between 1% and 3% over the medium term, with a focus to keep it near the 2% mid-point. To this end, the bank sets an appropriate level of interest rates. When inflation is too high, the RBNZ will increase interest rates to cool the economy, but the move will also make bond yields higher, increasing investors' appeal to invest in the country and thus boosting NZD. On the contrary, lower interest rates tend to weaken NZD. The so-called rate differential, or how rates in New Zealand are or are expected to be compared to the ones set by the US Federal Reserve, can also play a key role in moving the NZD/USD pair.

Macroeconomic data releases in New Zealand are key to assess the state of the economy and can impact the New Zealand Dollar's (NZD) valuation. A strong economy, based on high economic growth, low unemployment and high confidence is good for NZD. High economic growth attracts foreign investment and may encourage the Reserve Bank of New Zealand to increase interest rates, if this economic strength comes together with elevated inflation. Conversely, if economic data is weak, NZD is likely to depreciate.

The New Zealand Dollar (NZD) tends to strengthen during risk-on periods, or when investors perceive that broader market risks are low and are optimistic about growth. This tends to lead to a more favorable outlook for commodities and so-called 'commodity currencies' such as the Kiwi. Conversely, NZD tends to weaken at times of market turbulence or economic uncertainty as investors tend to sell higher-risk assets and flee to the more-stable safe havens.

 

Date

Created

 : 2024.10.24

Update

Last updated

 : 2024.10.24

Related articles

Show more

Writer

FXStreet

Financial media

arrow
FXStreet

FXStreet is a forex information website, delivering market analysis and news articles 24/7.
It features a number of articles contributed by well-known analysts, in addition to the ones by its editorial team.
Founded in 2000 by Francesc Riverola, a Spanish economist, it has grown to become a world-renowned information website.

Was this article helpful?
No loading Yes loading

We hope you find this article useful. Any comments or suggestions will be greatly appreciated.  
We are also looking for writers with extensive experience in forex and crypto to join us.

please contact us at [email protected].

Thank you for your feedback.
Thank you for your feedback.

Previous article

prev

Forex Today: Japanese Yen selling pauses, market attention shifts to PMI data

Next article

BRICS: De-dollarisation is on its way - ING

prev

Most viewed

GBP/USD rebounds from low 1.29s - Scotiabank

UK PMI data for October were broadly weaker than forecast. Manufacturing, Services and Composite readings all held above the 50 point this month but the sharp drop in Manufacturing (50.3, from 51.5) and the Composite measure (51.7, from 52.6) suggests a notable slowing in growth momentum, Scotiabank's Chief FX Strategist Shaun Osborne notes.
New
update2024.10.24 21:02

EUR/USD: EUR undertone remains weak - Scotiabank

The Euro (EUR) is nudging back over the 1.08 line as trading gets going in North America, Scotiabank's Chief FX Strategist Shaun Osborne notes.
New
update2024.10.24 20:59

USD/CAD: Push downwards to potentially extend to test support at 1.3750 - Scotiabank

The Bank of Canada (BoC) duly delivered the 50bps cut that the markets were more or less expecting yesterday.
New
update2024.10.24 20:54

GBP/CAD Price Forecast: Possibly extending higher in Rising Wedge pattern

GBP/CAD continues trading higher in what looks like a Rising Wedge pattern.
New
update2024.10.24 20:48

USD slips as US Yields drift - Scotiabank

The US Dollar (USD) is trading broadly lower on the day. Stocks are trading mixed (mostly lower in Asia, firmer in Europe, with US equity futures mixed) while bonds are broadly higher across the major markets.
New
update2024.10.24 20:45

Gold hit record highs on geopolitical risks and US election uncertainties - HSBC

Recently, uncertainties around the US elections on 5 November and geopolitical concerns have been supporting Gold.
New
update2024.10.24 20:26

JPY: Intervention risk steps up after sharp yen sell-off - MUFG

The Japanese Yen (JPY) has rebounded modestly overnight following yesterday's sharp sell-off.
New
update2024.10.24 20:21

EUR: ECB officials start to talk up possibility of larger 50bps cuts - MUFG

The Euro (EUR) has continued to weaken against the US dollar since last week's ECB policy meeting with EUR/USD falling to an intra-day low of 1.0761 on Wednesday, MUFG's FX analyst Lee Hardman notes.
New
update2024.10.24 20:16

Silver Price Forecast: XAG/USD bounces back above $34 on safe-haven bid

Silver price (XAG/USD) rebounds strongly above $34.00 in Thursday's European session after declining to near $33.40 on Wednesday.
New
update2024.10.24 20:13

Crude Oil jumps above $72.00 on failed talks in the Middle East

Crude Oil prices continue to increase and extend weekly gains on Thursday, with traders focusing on the geopolitical side of the price action again. The repricing comes after US Secretary of State Antony Blinken failed to broker a diplomatic deal between
New
update2024.10.24 20:03

Disclaimer:arw

All information and content provided on this website is provided for informational purposes only and is not intended to solicit any investment. Although all efforts are made in order to ensure that the information is correct, no guarantee is provided for the accuracy of any content on this website. Any decision made shall be the responsibility of the investor and Myforex does not take any responsibility whatsoever regarding the use of any information provided herein.

The content provided on this website belongs to Myforex and, where stated, the relevant licensors. All rights are reserved by Myforex and the relevant licensors, and no content of this website, whether in full or in part, shall be copied or displayed elsewhere without the explicit written permission of the relevant copyright holder. If you wish to use any part of the content provided on this website, please ensure that you contact Myforex.

arw
  • Facebook
  • Twitter
  • LINE

Myforex uses cookies to improve the convenience and functionality of this website. This website may include cookies not only by us but also by third parties (advertisers, log analysts, etc.) for the purpose of tracking the activities of users. Cookie policy

I agree
share
Share
Line

Line
Facebook

Facebook
X

Twitter
Cancel