Current trend

The NZD/USD pair is weakening, trading at 0.5900 amid the publication of the Q2 retail sales report from the National Statistical Office of New Zealand (Stats.nz).

Thus, the indicator decreased by 1.0% after falling by 1.6% earlier and by 1.1% in the fourth quarter of 2022, and eleven out of fifteen sectors of the economy showed negative dynamics. The construction equipment manufacturing (–4.8%) and food and beverage (–4.4%) industries suffered the most losses but auto parts trade increased 3.7% against the previous –2.1% correction. Macroeconomic statistics practically exclude the possibility of growth of the New Zealand currency.

The US dollar rose to 104.000 in the USD Index against yesterday’s data on the labor market: initial jobless claims decreased from 240.0K to 230.0K, better than the forecasted neutral dynamics. Thus, the total number of claims changed from 1.711M to 1.702M, and their average number over the past four weeks adjusted from 234.50K to 236.75K earlier due to stronger growth in previous weeks.

Support and resistance

The trading instrument is correcting, forming a global downward corridor with dynamic boundaries 0.6230–0.5870.

Technical indicators keep a stable sell signal: fast EMAs on the Alligator indicator move away from the signal line, and the AO histogram forms down bars in the sell zone, moving away from the transition level.

Resistance levels: 0.5980, 0.6100.

Support levels: 0.5860, 0.5730.

Trading tips

Short positions may be opened after the price drops and consolidates below 0.5860 with the target at 0.5730. Stop loss – 0.5950. Implementation period: 7 days or more.

Long positions may be opened after the price rises and consolidates above 0.5980 with the target at 0.6100. Stop loss – 0.5920.