Current trend

The NZD/USD pair is trading around the 0.5900 area, preparing to test the 0.5860 level, however, the downside looks limited.

Since the New Zealand economy is export-oriented, the negative dynamics of the national currency are developing against a recent decline in quotations of commodities: gold price lost 2.64% in August, and WTI Crude Oil is trading at 80.18, below the opening level of August 81.69, and continues to fall. However, the US macroeconomic statistics published last week may prevent further movement of the NZD/USD pair, and the asset, having reached the nearest support level of 0.5860, will start an upward correction.

The long-term trend is downward with the target at 0.5860, after reaching which it is possible to fix large sales. If it is held, an upward correction to 0.6010 will begin, from where new selling can be considered with the target at 0.5860. The RSI indicator is approaching the oversold zone, and when it enters the oversold zone, it is better to fix short positions and consider buying.

The medium-term trend is downward with the target in zone 3 (0.5871–0.5853), after which the next target will be zone 4 (0.5691–0.5673). The trend border is shifting to 0.6084–0.6066, and if the price corrects into this area, then short positions with the target at last week’s low at 0.5887 will become relevant.

Support and resistance

Resistance levels: 0.6010, 0.6110, 0.6245.

Support levels: 0.5860, 0.5750.

Trading tips

Short positions may be opened from 0.6010 with the target at 0.5860 and stop loss around 0.6060. Implementation period: 9–12 days.

Long positions may be opened above 0.6110 with the target at 0.6245 and stop loss around 0.6050.