NZD/USD Analysis Today - 02/10: Risk Aversion Drop (Chart)
Date
10/2/2024 2:42:16 PM
(MENAFN- Daily Forex) The downwards momentum in the NZD/USD the past two days of trading has brought the currency pair back to curious technical support ratios which are likely to attract speculative wagers.
The NZD/USD exchange rate is near the 0.62815 ratio as of this writing. On Monday of this week the currency pair was touching a high around 0.63800, but since then a surge lower and then incremental selling have returned values back to levels seen last Thursday. And this is where it begins to get interesting for day traders, the levels now being treated are within sight of intriguing support, but the NZD/USD remains within the upper part of its price realms via a one month technical chart.
The U.S will be releasing important jobs data on Friday and certainly financial institutions are positioning for the outcome. However, the selling in the USD/NZD and move back below the 0.63000 level likely has a lot to do with risk adverse sentiment being generated in Forex globally. Importantly the currency pair is still maintaining long-term highs and day traders nervous about current choppiness and the move lower the past two days need to remain patient. The 0.63000 is a solid barometer of sentiment for the moment.
Top Forex Brokers1 Get Started 74% of retail CFD accounts lose money Near-Term Wagering in the NZD/USD and Risk Appetite
Geopolitical concerns have hit the financial markets in the past day, but financial institutions also still know it is likely the U.S Federal Reserve is going to remain dovish moving forward. This acknowledgement could continue to create durable support. Yes, circumstances could change which could ignite more selling and a move to so-called safe haven assets, but calmer heads may prevail too, and financial institutions are likely able to absorb some levels of anxiety.
Traders should not bet wildly on the NZD/USD reversing higher, but there is a reason to believe the currency pair will again challenge the upper part of its values seen early this week. When this will happen is the big question. Trading over the near-term is likely to remain choppy, but if the world holds together and the U.S Non-Farm Employment Change numbers come in with weaker data this could ignite additional NZD/USD buying Trading Caution and Speculation in the NZD/USD
Traders cannot get overconfident. The financial markets may remain rather nervous over the next few days. The NZD/USD which has been doing well with a strong bullish run since late July could renew it moves higher. Certainly, the ratios seen earlier this week in the NZD/USD will be attainable if calm prevails in the coming days and U.S data is around expectations.
Short-term wagers should use solid risk management to guard against sudden spikes in the NZD/USD which are capable of unfolding.
If there is going to be volatility in the next day and a half –before the U.S jobs numbers – it might actually be to the downside because it might mean developing news has escalated nervous sentiment. However, calm waters and the U.S jobs numbers could help behavioral sentiment turn positive again for NZD/USD bulls. Traders need to be careful over the near-term.
NZD/USD Short Term Outlook:
Current Resistance: 0.62900
Current Support: 0.62775
High Target: 0.63350
Low Target: 0.62550
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