The New Zealand Dollar Failed to Break the 0.6135 Mark
- US CPI will be released on Tuesday
- The New Zealand Dollar failed to break the 0.6135 mark
- On Wednesday, the RBNZ will declare its interest rate decision
The New Zealand Dollar depreciated more than 1.5% just on Monday. The pair has faced strong resistance from the 0.6135 level.
The main trend of the NZD/USD is in a downward movement. It made a rebound to the 0.6135 level, and most probably will continue its move lower.
In addition, the New Zealand Dollar was traded below the 100 SMA, which indicates a bearish sentiment among investors.
In the next few days, if the NZD/USD succeeds to cross the white trendline to the downside, the pair will move sharply downward.
The next target could be the 0.5470 level.
To have a better idea of how the NZD/USD might move, a trader should look at the Dollar Index.
On Monday, the DXY index broke the 100 mark and closed above it. This indicates that the Greenback gained back power and entered again into the positive territory.
A powerful dollar means most of the major currencies, including the New Zealand Dollar, will depreciate.
Tomorrow, Wednesday, the RBNZ will declare its interest rate decision. Most analysts are not expecting a change in the interest rate.
What they are focusing on is whether the RBNZ will increase the quantitative ease size or not, and by how much. At the last meeting of RBNZ members, there was a talk that there will be an increase in Quantitative Ease size, double the one of March.
Today, the Consumer Price Index of the United States will be released. So, this news might also affect the movement of the New Zealand Dollar.
A reduction in the interest rates from the RBNZ will force the New Zealand Dollar to move lower on Wednesday.