NZDUSD Analysis
| Performance after Monday | |||||
| Period | Pct | Chg | Momentum | ||
| Monday | 1.36% | 75.9 Pips |  |
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| Week to-date | 1.26% | 70.8 Pips | |
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| January | 0.55% | 31.1 Pips |  |
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Upcoming key events (London Time)
Tue 09:45 PM NZD CPI Inflation Rate (12-mth)
What happened lately
There are no significant economic events currently reported, leaving the market primarily influenced by investor sentiment and global economic trends. However, traders are keenly awaiting the release of the Consumer Price Index (CPI) Inflation Rate for New Zealand, scheduled for Tuesday at 9:45 PM. This upcoming economic indicator is classified as having a high impact, underscoring its potential to introduce volatility and influence trading strategies significantly. CPI figures are crucial as they provide insights into the inflationary trends and cost of living adjustments, which, in turn, guide the Reserve Bank of New Zealand’s monetary policy decisions.
On Monday, the NZDUSD currency pair experienced a substantial appreciation, rising by 1.36% to settle at 0.56712. This upward movement in the New Zealand dollar against the US dollar highlights growing market optimism or shifts in the prevailing economic narratives. The rise could reflect investors’ speculative positioning in anticipation of the forthcoming CPI inflation data, suggesting an expectation of either stable or higher-than-forecast inflation rates which may influence future interest rate trajectories.
The upcoming CPI data release is critical for determining the future movements of NZDUSD as inflation rates play a pivotal role in central banking policies. Should the CPI demonstrate a higher-than-expected increase, markets might price in potential interest rate hikes by the Reserve Bank of New Zealand, thereby propelling the NZD higher against the USD due to the allure of potentially higher yields. Conversely, lower-than-expected inflation figures could weaken the NZDUSD pair as prospects for monetary tightening diminish, reducing attractiveness to investors seeking higher returns. Thus, traders will be closely monitoring this release for cues that could either sustain or reverse the current appreciation trend in the currency pair.
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What can we expect from NZDUSD today?
NZDUSD on Monday rose 1.36% to 0.56712. Price is above 9-Day EMA while Stochastic is rising.
Updated daily direction for NZDUSD looks bullish as the pair ended higher after Monday trading session.
Looking ahead for the day, immediate upside resistance level is R1 at 0.57084 with break above could target R2 at 0.57455 or figure level area. While towards the downside, we are looking at daily low of 0.55857 as an important support. Break below this level could weaken the current bullish momentum. A break above 0.56842 may suggest continuation after recent positive movement.
For the week to-date, take note that NZDUSD is bullish as the pair continued to trade higher and is up by 1.26% over the past few days.
Key levels to watch out:
| R3 | 0.58069 |
| R2 | 0.57455 |
| R1 | 0.57084 |
| Daily Pivot | 0.5647 |
| S1 | 0.56099 |
| S2 | 0.55485 |
| S3 | 0.55114 |
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