Published on May 22, 2023

Daily Analysis For NZD/USD 22-05-2023

NZD/USD Analysis

Economic Events and Scenario for NZD/USD

Economic Events : -

GMT	Event	Impact	Currency
00:50	(Japan) Machinery Orders YoY	Medium	JPY
00:50	(Japan) Machinery Orders MoM	Medium	JPY
01:00	(Canada) Victoria Day	None	CAD
01:00	(Montenegro) Independence Day	None	EUR
02:15	(China) Loan Prime Rate 1Y	Medium	CNY
02:15	(China) Loan Prime Rate 5Y	Medium	CNY
05:30	(Netherlands) Consumer Confidence	Medium	EUR
06:00	(Estonia) PPI YoY	Low	EUR
06:00	(Estonia) PPI MoM	Low	EUR
07:30	(Switzerland) Industrial Production YoY	Medium	CHF
08:00	(Slovakia) Current Account	Low	EUR
09:00	(Greece) Current Account	Low	EUR
09:00	(Australia) Myfxbook AUDUSD Sentiment	Medium	AUD
09:00	(Switzerland) Myfxbook USDCHF Sentiment	Medium	CHF
09:00	(Japan) Myfxbook USDJPY Sentiment	Medium	JPY
09:00	(European Union) Myfxbook EURUSD Sentiment	Medium	EUR
09:00	(United Kingdom) Myfxbook GBPUSD Sentiment	Medium	GBP
09:00	(Canada) Myfxbook USDCAD Sentiment	Medium	CAD
09:00	(New Zealand) Myfxbook NZDUSD Sentiment	Medium	NZD
10:00	(Belgium) Consumer Confidence	Low	EUR
10:00	(Euro Area) Construction Output YoY	Low	EUR
10:45	(European Union) EU Bond Auction	Low	EUR
11:00	(Ireland) Wholesale Prices MoM	Low	EUR
11:00	(Ireland) Wholesale Prices YoY	Low	EUR
11:00	(Luxembourg) Unemployment Rate	Low	EUR
11:30	(Portugal) Current Account	Low	EUR
13:00	(Kosovo) Balance of Trade	Low	EUR
13:30	(United States) Fed Bullard Speech	Medium	USD
14:00	(France) 3-Month BTF Auction	Low	EUR
14:00	(France) 12-Month BTF Auction	Low	EUR
14:00	(France) 6-Month BTF Auction	Low	EUR
15:00	(Euro Area) Consumer Confidence	Medium	EUR
15:50	(United States) Fed Barkin Speech	Medium	USD
15:50	(United States) Fed Bostic Speech	Medium	USD
16:30	(United States) 3-Month Bill Auction	Low	USD
16:30	(United States) 6-Month Bill Auction	Low	USD
20:00	(El Salvador) Balance of Trade	Low	USD

Today's Scenario: - NZD/USD continues to trade with a positive bias around 0.6275, extending its gains from the previous week despite mixed concerns regarding the Reserve Bank of New Zealand (RBNZ) on Monday. The Kiwi pair is benefiting from the US Dollar's retreat, which is attributed to the absence of a significant US debt ceiling announcement and mixed comments from Federal Reserve (Fed) officials.

In terms of RBNZ-related news, the New Zealand Institute of Economic Research (NZIER) has reported that the Shadow Board is divided on whether the Reserve Bank should raise the Official Cash Rate (OCR) in the May Monetary Policy Statement. On the other hand, analysts at ANZ have increased their peak OCR forecast to 5.75% before the Budget, citing factors such as high net migration and the fiscal outlook. They also see additional upside risks to the OCR after the Budget and estimate a 40% probability of a 50 basis point hike on Wednesday, which is in line with market expectations.

Overall, NZD/USD remains on a positive trajectory, benefiting from the US Dollar's weakness and mixed sentiments surrounding the RBNZ's monetary policy decisions.

Buy Scenario: - To maintain its upward momentum, NZD/USD needs to avoid falling below the 0.6182 pivot level. If it succeeds, it could target the First Major Resistance Level (R1) at 0.6246. A breakthrough of the Friday high at 0.6305 would indicate a bullish session. However, for a breakout to occur, it would require supportive news regarding the US debt ceiling and the People's Bank of China (PBoC).

In the event of a breakout, the Kiwi could potentially test the Second Major Resistance Level (R2) at 0.6371, with the Third Major Resistance Level (R3) at 0.6435 serving as the next target. Till we do not advise to buy NZD/USD.

Sell Scenario: - On the downside, if NZD/USD drops below the pivot level, it may encounter support at the First Major Support Level (S1) at 0.6058. However, unless there is a risk-off sentiment driving a sell-off, the pair is expected to stay above the sub-$0.62 level and the Second Major Support Level (S2) at 0.5993.

The Third Major Support Level (S3) is located at 0.5869. Till we do not advise to sell NZD/USD.

Support and Resistance Level: -