Current trend

Last week, the NZD/USD pair failed to break through the strong support area of 0.5890–0.5870 and is now trading around 0.5972, preparing to continue rising towards the resistance level of 0.6010.

Last week, the Reserve Bank of New Zealand (RBNZ) held a monetary policy meeting, which resulted in the interest rate remaining at a high level of 5.50%. The regulator explained that, to combat inflation, it is necessary to maintain the interest rate high for a long time, which will support the national currency exchange rate in the medium term.

The long-term trend remains downward: after reaching the support area of 0.5890–0.5870 last week, the quotes strengthened and are preparing to continue growing to 0.6010, after breaking through which the next correction target will be 0.6120, otherwise, the quotes are expected to renew the last week’s low of 0.5870 and consolidate below it. The breakdown of this mark will mean a high probability of continuation of the downward trend with the target at 0.5750.

The medium-term trend is downward: at the end of September, the price tested the key trend resistance of 0.6030–0.6014, after which it fell into the area of ​​zone 3 (0.5871–0.5853), which was held last week, as a result of which the New Zealand dollar is now strengthening. The target of corrective growth is the trend border of 0.6030–0.6014, after the breakdown of which the trend will change to an upward one with the target zone 2 (0.6185–0.6169), otherwise, the fall will continue to last week’s low of 0.5870.

Support and resistance

Resistance levels: 0.6010, 0.6120, 0.6245.

Support levels: 0.5890, 0.5870, 0.5750.

Trading tips

Short positions may be opened from 0.6010 with the target at 0.5870 and stop loss around 0.6060. Implementation time: 9–12 days.

Long positions may be opened above 0.6060 with the target at 0.6245 and stop loss around 0.6000.