Published on May 12, 2023

Daily Analysis For NZD/USD 12-05-2023

NZD/USD Analysis

Economic Events and Scenario for NZD/USD

Economic Events : -

GMT	Event	Impact	Currency
04:00	(New Zealand) Business Inflation Expectations	Low	NZD
04:35	(Japan) 3-Month Bill Auction	Low	JPY
06:00	(Finland) Current Account	Low	EUR
07:00	(United Kingdom) Goods Trade Balance	High	GBP
07:00	(United Kingdom) GDP YoY	Low	GBP
07:00	(United Kingdom) Goods Trade Balance Non-EU	High	GBP
07:00	(United Kingdom) Industrial Production MoM	Medium	GBP
07:00	(United Kingdom) Industrial Production YoY	Low	GBP
07:00	(United Kingdom) Manufacturing Production MoM	Medium	GBP
07:00	(United Kingdom) Manufacturing Production YoY	Low	GBP
07:00	(United Kingdom) Construction Output YoY	Low	GBP
07:00	(United Kingdom) Balance of Trade	Low	GBP
07:00	(United Kingdom) GDP Growth Rate YoY	High	GBP
07:00	(United Kingdom) GDP Growth Rate QoQ	High	GBP
07:00	(United Kingdom) Business Investment QoQ	Medium	GBP
07:00	(United Kingdom) Business Investment YoY	Low	GBP
07:00	(United Kingdom) GDP MoM	High	GBP
07:00	(United Kingdom) GDP 3-Month Avg	Medium	GBP
07:00	(United Kingdom) Construction Orders YoY	Low	GBP
07:45	(France) Inflation Rate YoY	Medium	EUR
07:45	(France) Inflation Rate MoM	Medium	EUR
07:45	(France) Harmonised Inflation Rate MoM	Low	EUR
07:45	(France) Harmonised Inflation Rate YoY	Low	EUR
08:00	(China) FDI (YTD) YoY	Medium	CNY
08:00	(Spain) CPI	High	EUR
08:00	(Spain) Core Inflation Rate YoY	Low	EUR
08:00	(Spain) Inflation Rate YoY	Low	EUR
08:00	(Spain) Inflation Rate MoM	Low	EUR
08:00	(Spain) Harmonised Inflation Rate YoY	Low	EUR
08:00	(Spain) Harmonised Inflation Rate MoM	Low	EUR
08:00	(United States) Fed Bowman Speech	Medium	USD
09:00	(Euro Area) ECB Guindos Speech	High	EUR
10:00	(China) Current Account	Medium	CNY
11:00	(Spain) Consumer Confidence	Medium	EUR
11:00	(Latvia) Current Account	Low	EUR
12:15	(United Kingdom) BoE Pill Speech	Medium	GBP
13:00	(United Kingdom) NIESR Monthly GDP Tracker	Low	GBP
13:30	(United States) Export Prices YoY	Low	USD
13:30	(United States) Import Prices YoY	Low	USD
13:30	(United States) Import Prices MoM	Medium	USD
13:30	(United States) Export Prices MoM	Medium	USD
13:45	(Germany) Current Account	Low	EUR
14:00	(Ecuador) Balance of Trade	Low	USD
15:00	(United States) Michigan Consumer Sentiment	High	USD
15:00	(United States) Michigan Inflation Expectations	Low	USD
15:00	(United States) Michigan Consumer Expectations	Low	USD
15:00	(United States) Michigan 5 Year Inflation Expectations	Low	USD
15:00	(United States) Michigan Current Conditions	Low	USD
15:30	(Canada) Senior Loan Officer Survey	Medium	CAD
17:00	(United States) WASDE Report	Low	USD
18:00	(United States) Baker Hughes Oil Rig Count	Low	USD
18:00	(United States) Baker Hughes Total Rig Count	Low	USD

Today's Scenario: - The NZD/USD pair is facing downward pressure as it continues its reversal from the monthly high and reaches the weekly low around 0.6260 in early Friday trading. This decline can be attributed to disappointing inflation data from New Zealand and overall strength in the US Dollar, which has led to a breach of key technical support levels.

The Reserve Bank of New Zealand's (RBNZ) Inflation Expectations for the second quarter of 2023 have dropped to the lowest levels since the third quarter of 2021, coming in at 2.79% compared to the previous reading of 3.30%. Additionally, New Zealand's Business NZ PMI for April fell to 49.1, below the expected 50.7 and the previous reading of 48.1. Visitor Arrivals in March also experienced a decline, growing by only 805% compared to the previous growth rate of 4,998%.

Buy Scenario: - On the upside, immediate recovery attempts by the NZD/USD pair could face resistance at the 50-day SMA and the previous support line, located around 0.6290 and 0.6300, respectively.

Further ahead, the one-month-old horizontal resistance area near 0.6315 and the double tops formed near 0.6385 will be critical levels to observe for potential bullish moves in NZD/USD. Till we do not advise to buy NZD/USD.

Sell Scenario: - The NZD/USD pair has experienced a break below key technical levels, including an upward-sloping trend line from late April and the 50-day Simple Moving Average (SMA) around 0.6300 and 0.6290, respectively.

In addition to the negative impact of New Zealand's economic data and the breach of technical supports, bearish signals from the Moving Average Convergence Divergence (MACD) indicator further support the selling pressure on NZD/USD, pushing it towards the weekly low near 0.6260.

However, it's worth noting that the Relative Strength Index (RSI) is nearing oversold territory, indicating a possible short-term support around the 200-day SMA level of approximately 0.6230 for NZD/USD bears to monitor.

If the 0.6230 support is breached, the focus will shift to the round figure of 0.6200 and the late April swing high around 0.6190. Till we do not advise to sell NZD/USD.

Support and Resistance Level: -