Bearish Signals Intensify for NZDUSD Below 0.5800

NZDUSD – technical overview

Overall pressure remains on the downside with the market continuing to stall out on runs up into the 0.6500 area. At the same time, there are some signs of the market wanting to put in a longer-term base. Ultimately, a break back above 0.6500 would be required to take the medium-term pressure off the downside and encourage this prospect. A monthly close below 0.5800 will intensify bearish price action.

• R2 0.6083 – 10 April high – Strong
  
• R1 0.5985 – 29 April high – Medium
  
• S1 0.5852 – 19 April 2024 low – Medium
  
• S2 0.5800 – Figure – Medium
  

NZDUSD – fundamental overview

RBNZ Governor Orr and Deputy Governor Hawkesby spoke earlier in the session before a parliamentary committee as part of their scheduled Financial Stability Report briefing. Hawkesby said that while there had been an increase in the proportion of non-performing loans, this had been "largely as predicted six months ago," and "provisions hadn't risen or weren't projected to rise as far as they had." On the data front, New Zealand building permits were balanced on the whole. Key standouts on Thursday’s calendar come from German and Eurozone manufacturing PMIs, Canada trade, US trade, US initial jobless claims, and US factory orders.

Exclusive FX research from LMAX Group Market Strategist, Joel Kruger