Extends winning spell to 0.5960 – Crypto News – Crypto News
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Extends winning spell to 0.5960 – Crypto News

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1 year ago

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  • NZD/USD rises to 0.5960 as US Dollar exhibits a weak footing ahead of US Q1 GDP data.
  • The consensus shows that the US economy expanded by 2.5% in the January-March period.
  • The New Zealand Dollar moves higher on improved demand for risk-perceived currencies.

The NZD/USD pair extends its winning streak for the fourth trading session on Thursday. The Kiwi asset movers higher to 0.5960 as the US Dollar falls further amid concerns over United States economic outlook due to a sharp decline in new business inflows in April, showed by S&P Global preliminary PMI report. The US Dollar Index (DXY), which tracks the US Dollar’s value against six major currencies, drops to 10-day low near 105.50.

Downside move in the US Dollar has improved demand for risk-sensitive currencies. However, the market sentiment remains uncertain as investors turn attention to the preliminary US Q1 GDP data, which will be published at 12:30 GMT. The US economy is projected to have grown at a moderate pace of 2.5% against 3.4% growth witnessed in the final quarter of the last year.

Going forward, investors will also watch the US core Personal Consumption Expenditure Price Index (PCE) data for March, which is a Fed’s preferred inflation measure. The inflation measures is estimated to have grown steadily by 0.3% on a month-on-month basis. This will influence speculation for Federal reserve (Fed) rate cuts, which are currently anticipated from the September meeting.

NZD/USD trades close to the upper-end of the inventory adjustment phase in which Kiwi positions are exchanged between institutional investors and retail participants. It is difficult to designate the phase as “accumulation” or “distribution” before a decisive break. The Kiwi asset is expected to deliver a decisive move after the release of the US Q1 GDP data.

Upward-sloping 20-period Exponential Moving Average (EMA) at 0.5947 signifies a bullish near-term appeal for the New Zealand Dollar.

The 14-period Relative Strength Index (RSI) rises above 60.00, suggesting a fresh upside momentum has been triggered.

Further upside above the psychological resistance of 0.6000 will drive the asset towards April 4 high around 0.6050 and the round-level resistance of 0.6100.

On the contrary, a fresh downside would appear if the asset breaks below April 16 low at 0.5860. This would drag the asset toward 8 September 2023 low at 0.5847, followed by the round-level support of 0.5900

NZD/USD hourly chart

 

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