NZD/USD Today 30/10: Weakens Amid Rising Yields (Video)
Date
10/30/2024 2:40:53 PM
(MENAFN- Daily Forex)
The New Zealand dollar continues to plummet against the US dollar as the bond market in America is essentially going straight up in the air as far as yields are concerned. As long as that is going to be the case, you have a situation where it's difficult to get overly excited about shorting the greenback and therefore buying currency such as a New Zealand dollar.
I think at this point, you're looking for short-term rallies to fade, but these would be short-term trades because clearly you are late in the trend. The 0.5850 level underneath is a massive support level, but I also think it's our target now. The market certainly should see a certain amount of resistance in the form of the 0.6050 level and the fact that the 50-day EMA is getting ready to cross below the 200-day EMA suggests that the so-called death cross is ready to kick off. I don't know how much I would read into that, but it is something that some people pay attention to.
Top Forex Brokers1 Get Started 74% of retail CFD accounts lose money RBNZ Cut Rates by 50 Basis Points Recently
Remember, it wasn't that long ago where the Reserve Bank of New Zealand had to cut interest rates by 50 basis points, which sent the market into a tailspin. It was selling off before then, but it really took off at that point. Between that and the fact that yields in America continue to spike, I think you've got a situation where the markets are just going crazy, mainly because of the bond market.
There are also plenty of concerns about global growth, and that does have an influence on a commodity driven economy such as New Zealand, although admittedly, it is more agriculturally commoditized than anything else. So, there's a little bit of a buffer in that. But at this point in time, I think this is a market you have to look at each and every rally as an opportunity to short the New Zealand dollar and pick up cheap greenbacks.
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