Nzdusd drops amid positive trade data, consolidation phase continues

NZDUSD Analysis

Performance after Tuesday
Period	Pct	Chg	Momentum
Tuesday	-0.55%	-32.7 Pips
Week to-date	0.34%	20.2 Pips
April	4.94%	280.2 Pips

Upcoming key events (London Time)

No major events for the day.

What happened lately

New Zealand’s economic data for March shows positive adjustments in trade activities. The nation’s exports rose significantly, reaching $7.59 billion up from $6.74 billion in February, indicating stronger demand for New Zealand’s goods abroad. Furthermore, the trade balance, although still negative, improved to a deficit of -6.13 billion NZD from -6.51 billion NZD the previous month. This improvement signifies a narrowing trade deficit, which could point towards gradual economic strengthening or improved trade terms. Conversely, imports also saw an increase to $6.62 billion from $6.22 billion in February, suggesting heightened domestic demand or replenishment of inventories.

In terms of currency impact, the data influences the NZD by potentially boosting investor confidence due to the healthier trade figures, which could contribute to upward pressure on the NZD. However, the NZDUSD pair dropped by 0.55% to 0.59595, showing signs of consolidation. The lack of major events for the day likely keeps traders hesitant to make significant moves, leading to cautious trading behavior. While the improved trade statistics provide a positive backdrop, persistent broader market pressures or profit-taking could weigh on the NZD, maintaining the consolidation phase in the near term. Consequently, despite the favorable trade data, the NZD’s strength against the USD might remain subdued unless more definitive economic developments arise.

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What can we expect from NZDUSD today?

NZDUSD on Tuesday dropped -0.55% to 0.59595. Price is above 9-Day EMA while Stochastic is falling.

Updated daily direction for NZDUSD looks mixed as the pair is likely to consolidate above 0.5934 (S1).

Looking ahead today, to see upside interest, we prefer to look at price breakout of last daily high of 0.60289 or trades above daily pivot 0.59815. Break above could target R1 at 0.60069. While to the downside, we are looking at 0.5934 (S1) and daily low of 0.59560 as support levels. NZDUSD need to break on either side to indicate a short-term bias. A close below 0.59560 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:

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