NZDUSD is trading around slightly higher from its opening price despite dovish remarks from RBNZ officials hitting newswires. As of this writing, the currency pair is trading 0.07% from its opening price at 0.6045.
Earlier today, RBNZ Deputy Governor Bascand and RBNZ Assistant Governor Hawkesby shared a few remarks on monetary policy. On the positive side of things Bascand said that the current price of NZDUSD is conducive for exports. Meanwhile, Hawkesby said that there may be no need to further increase the QE program.
Alternatively, on a more hawkish note, Bascand implied that negative rates may not be off the table. He said that banks should be ready to implement negative rates on wholesale markets by the end of 2020. As for Hawkesby, he shared that the central bank projects NZDUSD to fall.
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NZDUSD Outlook
On the 4-hour time frame, it can be seen that NZDUSD is testing a confluence of resistance. By trading around 0.6040, the currency pair is testing resistance at the 100 SMA. This price also coincides with the 61.8% Fib level when you draw the Fibonacci retracement tool from the high of May 12 to the low of May 15. Lastly, this price also coincides with a broken trendline when you connect the lows of April 3, April 23, and May 7. A shooting star candlestick has already formed which could indicate that sellers may soon push NZDUSD to near-term support around 0.5916 where it bottomed on May 15.
On the other hand, a strong bullish close above yesterday’s high at 0.6041 could mean that there are still buyers in the market. Should this happen, we may soon see NZDUSD trade higher to its May 11 highs at 0.6155.
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