Concerns over a “higher for longer” interest rate environment have pushed USD higher and “risky” assets like NZD lower today.
How low can NZD/USD go?
Lemme tell you all about the potential support zones that we’re eyeing:
NZD/USD 1-Hour Forex Charts by TV
There were not a lot of top-tier economic releases to shake the financial markets today but that doesn’t mean we didn’t see at least some volatility!
In fact, there’s been a clear winner in the past couple of days.
And no it’s not Donna Kelce, mom to TWO Super Bowl players and Taylor Swift’s new BFF.
It’s the U.S. dollar, yo! Thanks to the Fed’s hawkish statement last week, traders are flocking to USD as U.S. bond yields also go up.
Meanwhile, concerns over the negative impact of a high-interest rate environment on the major economies’ growth trajectories have created a risk-averse trading environment that dragged on “risky” assets like the comdolls and pushed safe havens assets (like USD) higher.
NZD/USD, which recently retested its .5985 resistance zone, dropped to the .5940 area closer to the 1-hour chart’s 200 SMA.
How low can NZD/USD go before the comdoll pair sees enough buying pressure?
We’re keeping close tabs on the .5920 trend line support. As you can see, it’s not too far from today’s S1 (.5910) Pivot Point level. It’s also just below the 100 and 200 SMAs that may attract at least some bulls.
Today’s U.S. economic data releases can give us opportunities to buy NZD against the U.S. dollar.
The U.S. CB consumer confidence, new home sales, and Richmond manufacturing index reports are expected to print lower later today. If they do print to the downside, then traders may go back to pricing in their “peak rate” bets and unload some of their long USD positions.
NZD/USD may see bullish reversal candlesticks and maybe even a bit of bullish momentum along the support zone that we’ve marked.
Planning on trading NZD/USD potentially extending its September uptrend?
Make sure that you have enough technical and fundamental reasons to go long and that you’re practicing your best risk management moves if you’re eyeing potential profit targets like .5985 or .6000!
This content is strictly for informational purposes only and does not constitute as investment advice. Trading any financial market involves risk. Please read our Risk Disclosure to make sure you understand the risks involved.