NZDUSD Analysis
| Performance after Wednesday | |||||
| Period | Pct | Chg | Momentum | ||
| Wednesday | -0.54% | -30.4 Pips |  |
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| Week to-date | -0.16% | -9.1 Pips |  |
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| January | -0.58% | -32.7 Pips | |
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Upcoming key events (London Time)
Fri 01:30 PM USD Nonfarm Payroll Employment
What happened lately
In the United States, recent labor market reports reveal a decline in initial unemployment insurance claims to 201,000 for the week ending January 4, a decrease from the previous week’s figure of 211,000. This information, released by the Department of Labor, suggests a tightening labor market, indicative of fewer individuals filing for unemployment benefits, which might be a sign of economic resilience. Additionally, the Job Openings and Labor Turnover Survey (JOLTS) for November from the Bureau of Labor Statistics indicated an increase in job openings, reaching 8.098 million compared to the revised October figure of 7.744 million. This upward trend suggests that the demand for labor continues to expand, as companies appear to seek more employees. Together, these indicators reflect a strong U.S. labor market which could contribute to heightened consumer confidence and potentially bolster economic activity.
Turning to the NZDUSD currency pair reaction, the New Zealand dollar weakened against the U.S. dollar, declining by 0.54% to 0.56047 on Wednesday. The stronger U.S. labor market data, indicating a decrease in unemployment claims and an increase in job openings, generally suggests a robust economic environment which in turn supports the U.S. dollar. Markets may be anticipating a solid Nonfarm Payroll Employment report, identified as a high-impact event, scheduled for release on Friday. As strong labor market data often leads to speculation of tightening monetary policies or sustained higher interest rates by the Federal Reserve, this can increase the attractiveness of the U.S. dollar, potentially placing downward pressure on the NZDUSD pair. If the upcoming Nonfarm Payroll report aligns with these positive labor trends, further strengthening of the USD could be witnessed, possibly leading to additional declines in NZDUSD. Conversely, any negative surprises in the data might provide some respite for the New Zealand dollar against its U.S. counterpart.
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What can we expect from NZDUSD today?
NZDUSD on Wednesday dropped -0.54% to 0.56047. Price is below 9-Day EMA while Stochastic is rising.
Updated daily direction for NZDUSD looks bearish as the pair posted lower in Wednesday trading session.
Looking ahead for the day, immediate support level is at S1 0.55818 with break below could see further selling pressure towards S2 at 0.55589. To the upside, with the current momentum bearish, we prefer to look at breakout of the recent daily high of 0.56420 as a potential indicator of buying interest. Failure to break the resistance level would continue to echo bearish sentiment. A close below 0.55890 would indicate selling pressure.
For the week to-date, take note that NZDUSD is mixed as compared to the prior week.
Key levels to watch out:
| R3 | 0.56878 |
| R2 | 0.56649 |
| R1 | 0.56348 |
| Daily Pivot | 0.56119 |
| S1 | 0.55818 |
| S2 | 0.55589 |
| S3 | 0.55288 |
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