New Zealand Dollar: NZD/USD (NZD=X) Dips on Dovish NZ Central Bank
The New Zealand central bank maintained the benchmark rate at an even 1.0% Wednesday. This decision had been priced in by the markets. However, the NZ dollar still fell 0.70% after the bank’s policy meeting, as the bank said it was keeping the door open to further rate cuts if needed. The bank has not been shy to act, as the markets learned in August, when rate-setters slashed rates from 1.5% to 1.0%. The low rate and dovish stance of the bank means that the NZ dollar is unlikely to get any help from current monetary policy.
NZD/USD Technical Analysis
NZD/USD has been flirting with the 0.6280 throughout the week. The pair is currently just above this line and I expect this line to remain relevant for the remainder of the week. Below, there is support at 0.6240. On the upside, the next resistance line is 0.6360.
Overall, the bias in prices is: Downwards.
The projected upper bound is: 0.64.
The projected lower bound is: 0.62.
The projected closing price is: 0.63.
A white body occurred (because prices closed higher than they opened).
During the past 10 bars, there have been 4 white candles and 6 black candles for a net of 2 black candles. During the past 50 bars, there have been 20 white candles and 30 black candles for a net of 10 black candles.
Momentum is a general term used to describe the speed at which prices move over a given time period. Generally, changes in momentum tend to lead to changes in prices. This expert shows the current values of four popular momentum indicators.
One method of interpreting the Stochastic Oscillator is looking for overbought areas (above 80) and oversold areas (below 20). The Stochastic Oscillator is 45.4545. This is not an overbought or oversold reading. The last signal was a buy 2 period(s) ago.
Relative Strength Index (RSI)
The RSI shows overbought (above 70) and oversold (below 30) areas. The current value of the RSI is 40.51. This is not a topping or bottoming area. A buy or sell signal is generated when the RSI moves out of an overbought/oversold area. The last signal was a buy 3 period(s) ago.
Commodity Channel Index (CCI)
The CCI shows overbought (above 100) and oversold (below -100) areas. The current value of the CCI is -69. This is not a topping or bottoming area. The last signal was a buy 2 period(s) ago.
The Moving Average Convergence/Divergence indicator (MACD) gives signals when it crosses its 9 period signal line. The last signal was a sell 5 period(s) ago.
Rex Takasugi – TD Profile
FOREX NZD= closed up 0.003 at 0.630. Volume was 0% above average (neutral) and Bollinger Bands were 10% narrower than normal.
Open High Low Close Volume___
0.627 0.633 0.627 0.630 34,808
Short Term: Neutral
Intermediate Term: Bearish
Long Term: Bearish
Moving Averages: 10-period 50-period 200-period
Close: 0.63 0.64 0.66
Volatility: 10 8 9
Volume: 29,245 32,565 38,527
Short-term traders should pay closer attention to buy/sell arrows while intermediate/long-term traders should place greater emphasis on the Bullish or Bearish trend reflected in the lower ribbon.
FOREX NZD= is currently 5.2% below its 200-period moving average and is in an downward trend. Volatility is extremely high when compared to the average volatility over the last 10 periods. There is a good possibility that volatility will decrease and prices will stabilize in the near term. Our volume indicators reflect volume flowing into and out of NZD= at a relatively equal pace (neutral). Our trend forecasting oscillators are currently bearish on NZD= and have had this outlook for the last 3 periods.
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