The New Zealand Dollar is inching higher early Thursday as a rise in coronavirus cases in the United States is weighing on optimism about a quick economic recovery, while pressuring demand for the higher-yielding Kiwi and making the safe-haven greenback a more attractive asset. The U.S. Dollar was also boosted by the news that the United States is weighing tariffs on European products.
At 04:39 GMT, the NZD/USD is trading .6420, up 0.0011 or +0.16%.
In other news, according to the International Monetary Fund, the coronavirus pandemic is causing wider and deeper damage to economic activity than first thought, prompting the institution to slash its 2020 global output forecasts further.
Additionally, on Wednesday, New Zealand’s central bank kept rates unchanged and maintained its pace of quantitative easing, but struck a dovish tone by flagging it was ready to ease policy to restore an economy hit by the coronavirus pandemic.
Daily Swing Chart Technical Analysis
The main trend is up according to the daily swing chart. A trade through .6381 will change the main trend to down. A move through .6533 will signal a resumption of the uptrend.
The minor range is .6585 to .6381. Its 50% level or pivot at .6483 is controlling the direction of the NZD/USD this week.
The short-term range is .5921 to .6585. If the main trend changes to down then its retracement zone at .6253 to .6175 will become the primary downside target.
The main range is .5469 to .6585. Its retracement zone at .6027 to .5895 is controlling the longer-term direction of the NZD/USD.
Daily Swing Chart Technical Forecast
Since June 11, the direction of the NZD/USD has been controlled by the minor pivot at .6483. Therefore, the direction of the market Forex pair on Thursday is likely to be determined by trader reaction to this level.
A sustained move under .6483 will indicate the presence of sellers. The first two downside targets are main bottoms at .6383 and .6381. The latter is a potential trigger point for an acceleration to the downside with the next major target level coming in at .6253.
A sustained move over .6483 will signal the return of buyers. This could lead to a challenge of the main top at .6533. Taking out this level could trigger a surge into .6585.
For a look at all of today’s economic events, check out our economic calendar.
This article was originally posted on FX Empire
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