As a result of an almost recoilless decline over the past 2 months, the NZD / USD pair reached a local minimum near the 0.6190 mark in early March, which corresponds to the lows of July 2009, when the global crisis of 2008 only began to decline.
However, in early March, the decline in NZD / USD stopped, and in the last 3 days the pair rose sharply, reaching 0.6300 at the beginning of today's European session.
On Tuesday, representatives of the G7 promised to use all the necessary tools to protect their economies from the risks associated with the outbreak of coronavirus, and the Fed unexpectedly lowered the interest rate by 0.50%. “The fundamental economic indicators of the United States remain strong. Nevertheless, coronavirus poses a growing risk for economic activity”, the central bank said. “The Committee (the Federal Reserve for Open Market Operations) is closely monitoring developments and their potential impact on economic prospects. intending to use their tools and act accordingly to support the economy".
In March, the Fed, the ECB, the Bank of Japan, the Bank of England, the National Bank of Switzerland, and the RB of New Zealand will hold their next meetings on monetary policy, and today the Bank of Canada will decide on the rates.
He will probably also follow the example of the Fed and lower the interest rate. A meeting of the Reserve Bank of New Zealand is scheduled for March 25. The bank is likely to lower its key interest rate, and it is possible to lower it by 0.50%. However, a more significant role in the dynamics of NZD will be played by the state of world stock markets.
If the growth of stock indices continues, then, accordingly, commodity currencies, in particular, NZD, will continue to strengthen.
OsMA and Stochastic indicators on the 1-hour, 4-hour, daily charts of the pair NZD / USD turned to long positions. In case of continued growth of NZD / USD, the target will be the resistance level of 0.6500 (EMA200 on the daily chart).
Below this level of resistance, negative long-term dynamics still prevail, and a return to the zone below the level of 0.6300 (EMA200 on the 1-hour chart) will cause a resumption of the decline in NZD / USD.
In this case, the targets will be the support levels of 0.6260 (September 2015 lows and the Fibonacci level 0% of the correction in the global wave of pair decline from the level of 0.8820), 0.6205 (September lows), 0.6190 (local multi-year lows).
Support Levels: 0.6260, 0.6200, 0.6100
Resistance Levels: 0.6300, 0.6322, 0.6378, 0.6406, 0.6485, 0.6505, 0.6600, 0.6635, 0.6665, 0.6740, 0.6830, 0.6865
Trading Scenarios
Sell Stop 0.6290. Stop-Loss 0.6325. Take-Profit 0.6260, 0.6200, 0.6100
Buy Stop 0.6325. Stop-Loss 0.6290. Take-Profit 0.6378, 0.6406, 0.6485, 0.6505, 0.6600, 0.6635, 0.6665, 0.6740, 0.6830, 0.6865
