The NZD/USD pair has experienced a significant decline, touching a low of 0.5841 and reaching a yearly trough of 0.5796. The primary pressure comes from a robust US dollar, bolstered by anticipations of a more stringent tariff regime under US President-elect Donald Trump. Speculations about Trump imposing an additional 10% tariff on all Chinese goods have particularly impacted the Kiwi, given China’s role as New Zealand’s largest trading partner.
The market pre-emptively reacts to potential US policy shifts, recalling Trump’s previous term characterised by aggressive trade policies. This has cast a long shadow over the NZD, influencing investor sentiment.
The upcoming Reserve Bank of New Zealand (RBNZ) meeting on Wednesday is crucial, with expectations leaning towards a 50-basis-point rate cut to 4.25% per annum. This expected move aligns with the RBNZ’s dovish stance from October and could sustain the downward pressure on the NZD.
Technical analysis of NZD/USD
H4 chart: the NZD/USD has completed a decline wave, reaching 0.5797, with a subsequent recovery phase targeting 0.5922 underway. After reaching this level, a potential pullback to 0.5860 could establish a consolidation zone around this marker. A break below this range might extend the decline to 0.5777, while an upward breach could pave the way to 0.5977.
H1 chart: the pair is forming an initial growth wave towards 0.5860. Following this target, a retraction to 0.5828 is likely. The Stochastic oscillator supports this currency forecast, indicating a possible downturn from elevated levels and enhancing the likelihood of continuing the downward trajectory.
Before you enter foreign exchange and stock markets, you have to remember that trading currencies and other investment products is trading in nature and always involves a considerable risk. As a result of various financial fluctuations, you may not only significantly increase your capital, but also lose it completely. Therefore, our clients have to assure RoboForex that they understand all the possible consequences of such risks, they know all the specifics, rules and regulations governing the use of investment products, including corporate events, resulting in the change of underlying assets. Client understands that there are special risks and features that affect prices, exchange rates and investment products.
Recommended Content
Editors’ Picks
EUR/USD turns positive to retake 1.0500, as focus shifts to Fed Minutes
EUR/USD is trading close to 1.0500 in Tuesday's European trading, erasing lsses to trade in the green. The US Dollar reverses President-elect Trump’s tariff threats-led gains, allowing the pair to stage a modest recovery heading into the release of the Fed Minutes later in the day.
GBP/USD extends recovery toward 1.2600 ahead of BoE's Pill, Fed Minutes
GBP/USD extends the recovery toward 1.2600 in the European session on Tuesday, following a slump to the 1.2500 area in Asian trading. The pair finds footing amid a retreat in the US Dollar as markets look past Trump tariff threats, bracing for BoE Pill's speech and Fed Minutes.
Gold price defends $2,600 ahead of FOMC minutes; not out of the woods yet
Gold price retains its negative bias for the second straight day and trades just above a one-week low during the first half of the European session on Tuesday. The growing conviction that Donald Trump's expansionary policies will reignite inflation and limit the scope for the Fed to cut interest rates further triggers a fresh leg up in the US Treasury bond yields.
Trump shakes up markets again with “day one” tariff threats against CA, MX, CN
Pres-elect Trump reprised the ability from his first term to change the course of markets with a single post – this time from his Truth Social network; Threatening 25% tariffs "on Day One" against Mexico and Canada, and an additional 10% against China.
Eurozone PMI sounds the alarm about growth once more
The composite PMI dropped from 50 to 48.1, once more stressing growth concerns for the eurozone. Hard data has actually come in better than expected recently – so ahead of the December meeting, the ECB has to figure out whether this is the PMI crying wolf or whether it should take this signal seriously. We think it’s the latter.
Best Forex Brokers with Low Spreads
VERIFIED Low spreads are crucial for reducing trading costs. Explore top Forex brokers offering competitive spreads and high leverage. Compare options for EUR/USD, GBP/USD, USD/JPY, and Gold.