A Downward Drift for NZDUSD

Key Highlights

  • US Dollar failed to gain buyers after the FOMC meeting minutes, and currently looks like positioning for a correction.
  • NZDUSD managed to find support around 0.7280, and currently testing an important resistance area.
  • New Zealand Visitor Arrivals released by the Statistics New Zealand posted an increase of 6.1% in April 2015, compared to the previous rise of 15.1%.

NZDUSD – Technical Analysis

The New Zealand Dollar declined sharply recently against the US dollar, but later managed to gain traction around the 0.7280 support area. The NZDUSD is currently attempting to correct higher, and it would be interesting to see how sellers react in the short term. There are a couple of bearish trend lines formed on the hourly chart, which might act as a hurdle for buyers.

A critical resistance is around the upper bearish trend line, i.e. also aligned with the 38.2% Fib retracement level of the last drop from the 0.7443 high to 0.7280 low. The hourly RSI is approaching the 50 mark, which suggests that the pair is heading towards a crucial swing area.

NZDUSD 05.21.2015

On the downside, the 0.7280 support area holds the key as it represents a major barrier for sellers.

New Zealand Visitor Arrivals

Earlier during the Asian session, the Visitor Arrivals, which measures the number of visitors to New Zealand was released by the Statistics New Zealand. The outcome was lower when compared to the last increase of 15.1%. In April 2015, the New Zealand Visitor Arrivals rose by 6.1%, compared to the same month a year ago.

Commenting on the same, the population statistics manager, Vina Cullum, stated that “the annual number of visitors from China topped 300,000 for the first time, and the 302,100 visitor arrivals from China in the April 2015 year were up 26 percent from the previous year. Most of this increase was holidaymakers”.

The NZDUSD traded a bit higher after the release and as of writing heading towards the highlighted resistance area.

US Existing Home Sales

In the US, there are a couple of important releases scheduled today, including the Existing Home Sales, which will be published by the National Association of Realtors. The forecast is lined for a 1% increase in April 2015, compared to the preceding month.

Aayush Jindal

Aayush is a Senior Forex, Cryptocurrencies and Financial Market Strategist with a background in IT and financial markets. He specialises in market strategies and technical analysis, and has spent over a decade as a financial markets contributor and observer. He possesses strong technical analytical skills and is well known for his entertaining and informative analysis of the currency, commodities, Bitcoin and Ethereum markets.

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