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The NZDUSD is Consolidating Near Local Highs

3/15/2023 11:14 AM

The NZD/USD pair shows mixed trading dynamics, consolidating near 0.6230. The instrument is still inclined to develop an uptrend, which formed last week and led to an update of local highs from March 1. However, the "bullish" momentum that was driven by the closures of two US banks, Silicon Valley Bank and Signature Bank earlier in the week, seems to be fading away. The US stock market showed a corrective recovery on the eve, although many securities failed to win back significant Monday's losses, despite the announcement of the Bank Term Funding Program (BTFP) by the US Federal Reserve and the rhetoric of President Joe Biden, who signaled to the market that the situation is under control.

The US macroeconomic statistics released yesterday also contributed to some stabilization of the situation. In February, the Consumer Price Index slowed down from 6.4% to 6.0%, and the Core CPI corrected from 5.6% to 5.5%, which coincided with market expectations. A further decline in inflation will allow the US regulator not to increase the pace of tightening monetary policy in order to avoid aggravating the situation with a possible banking and financial crisis in the country.

Today, data on the dynamics of the Gross Domestic Product (GDP) of New Zealand for the fourth quarter of 2022 will be published. Forecasts suggest a slowdown of 0.2% on a quarterly basis and an acceleration of 3.3% on an annualized basis. According to the results of the third quarter, the country's economy grew by 2.0% QoQ and 6.4% YoY, respectively.

On the D1 chart Bollinger Bands are trying to reverse into the ascending plane. The price range expands from above, freeing a path to new local highs for the "bulls". MACD grows, preserving a stable buy signal (located above the signal line). Stochastic keeps its upward direction but is rapidly approaching its highs, which reflects the risks of overbought New Zealand dollar in the ultra-short term.

Resistance levels: 0.6250, 0.6300, 0.6350, 0.6400. | Support levels: 0.6200, 0.6155, 0.6100, 0.6049

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