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NZDUSD Market Update

11/18/2022 12:42 PM

While the US dollar continues its downward correction, the New Zealand currency is seizing the initiative in the NZD/USD pair and is trading around 0.6163.

Local growth of quotations is supported by macroeconomic data. According to a report from Stats NZ, the Producer Price Index Input added 0.8% in September, which was below the analysts' forecast of an increase of 2.6%, while the Producer Price Index Output rose 1.8% against the forecast of 2.1%. Nevertheless, the released data can be considered positive, as prices in key sectors of electricity and gas supply were significantly lower than in the previous period. As before, the leadership is held by the food products sector: the cost of production of dairy products added 9.9%, and meat products added 6.2%. According to experts, such dynamics is a consequence of the increase in interest rates, as a result of which the purchase prices for fertilizers and fuel have increased.

The US currency is holding around 106.500 in the USD Index after the release of weak statistics the day before. According to data for October, the number of Building Permits issued amounted to 1.526 million after 1.564 million in September, and the volume of Housing Starts fell to 1.425 million from 1.488 million a month earlier. The labor market also shows mixed dynamics: the number of Initial Jobless Claims this week amounted to 222.0 thousand, which is slightly lower than 226.0 thousand a week earlier, but the Continuing Jobless Claims increased to 1.507 million from 1.494 million a week earlier.

Quotes of the NZD/USD pair have left the limits of the global downward channel on the daily chart, having fixed above the resistance line.

Technical indicators hold a steady buy signal, which continues to strengthen: fast EMAs on the Alligator indicator are moving away from the signal line, and the AO oscillator histogram, trading in the buy zone, continues to form new ascending bars.

Support levels: 0.6062, 0.5880. | Resistance levels: 0.6200, 0.6450.

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