The NZDUSD – like the AUDUSD – traded to new 2023 lows and to the lowest level since November 2023. The price, however, has seen a rebound back toward the low price going back to the end of May at 0.5985. If the price were to get above that level – and stay above that level – some shorts may look to cover and correct to the next targets. That next target swing area would come between 0.60249 and 0.60320 (see red circles below). Moving above that area would give buyers more confidence.
The RBNZ meets this week (on Wednesday in New Zealand with rate decision at 10 PM ET on Tuesday). The central bank is expected keep the rate unchanged at 5.5%.
Back on May 24 , the RBNZ raised rates to 5.5% and signaled it was done tightening. The price on that day closed at 0.6112. Since then the price initially move down to the 0.5985 level, then bounced sharply higher trading to the highest level going back to February at 0.64117 on July 14. Since then, the price has been tracking to the downside helped also by a stronger US dollar as US rates moved higher.
On the downside, the 61.8% retracement of the move up from the 2022 low comes in at 0.5903.
This article was written by Greg Michalowski at www.forexlive.com. Source