NZD/USD Trades to Yearly Lows on RBNZ News
- NZD/USD Trades to Yearly Lows on RBNZ News
- Daily Breakouts May Occur Below .6862
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The NZD/USD is trading off of new lows this morning, as the RBNZ (Reserve Bank of New Zealand) elected to keep key interest rates at 1.75%. While the decision to keep rates flat was not surprising, statements made by RBNZ’s Wheeler later in the session took a dovish stance. This news directly sent the NZD/USD to levels not seen since June of 2016.
Traders should note that the NZD/USD is now trading in a downtrend, with prices below both its 10 day EMA (exponential moving average) and 200 day MVA (simple moving average). Also the pair is set to close below .6862, which is the December 2016 swing low. A move to this point places the NZD/USD at new yearly lows, and suggests that the pair may fall further. In the event of a bullish reversal, traders should first look for prices to trade back above .6862, and then challenge the 10 day EMA found at .6888.
NZD/USD Daily Chart & Averages
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Sentiment figures for the NZD/USD remain net positive for Thursday’s trading, but have failed to reach extremes. Currently IG Client Sentiment (IGCS) reads at +1.32, with 56.9% of traders long the currency pair. This value is modestly biased long with the majority of traders net long. Typically when taken as a contrarian signal, this suggests that the NZD/USD may decline further. In the event of a continued price decline, traders should watch for sentiment figures to reach positive extremes of +2.00 or more. Alternatively if the currency pair rebounds, sentiment figures may decline back towards more neutral readings.
--- Written by Walker, Analyst for DailyFX.com
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DailyFX provides forex news and technical analysis on the trends that influence the global currency markets.