In this comprehensive analysis, Ultima Markets brings you an insightful breakdown of the NZDUSD for Aug 13, 2024. 

Key Takeaways 

• New Zealand’s entanglement: A series of recent business and consumer surveys in New Zealand, as well as more frequent spending and credit data, all indicate that economic activity is declining. The risk of over-tightening monetary policy has become a reality. In less than two years, New Zealand’s economy may show signs of a third recession, and interest rate cuts seem imminent. 

• Divergence on interest rate cuts: According to the New Zealand Economic Research Association (NZIER), the New Zealand Reserve Bank’s shadow committee is divided on the August interest rate decision. Among the 21 economists surveyed, 12 expect the New Zealand Reserve Bank to keep the interest rate unchanged at 5.5%. At present, some domestic prices are still high. If interest rate cuts are initiated now, it will be one year earlier than the signal just sent by the central bank three months ago. This will be a huge change for the New Zealand Reserve Bank. 

• A surprise may trigger a plunge: If the New Zealand Reserve Bank cuts interest rates beyond expectations, the decision to cut interest rates earlier than the Fed may lead to a stronger downward trend in the New Zealand dollar against the US dollar. 

Technical Analysis 

Daily Chart Insights 

• Stochastic Oscillator: The indicator has entered the overbought area, and the fast line shows signs of turning downward. It suggests that the current exchange rate rise has slowed down, and investors need to be alert to the risk of the exchange rate turning around. 

• Strong resistance: The exchange rate is currently blocked by multiple resistances-the black 65-day moving average and the weekly level fair value gap (FVG). Strong resistance makes it difficult for NZD/USD to break through the upward trend this week and pay attention to any bearish price behavior. 

1-hour Chart Analysis 

• MACD: The indicator oscillates repeatedly above the 0 axis, and the highest point of the column continues to decline, forming a divergent structure with the exchange rate. Investors need to be alert to the indicator falling below the zero axis after issuing a short signal, when the exchange rate may usher in a downward trend. 

• Wolfe wave pattern: The exchange rate currently forms a structure suspected to be a Wolfe wave. If the exchange rate continues to surge to the extension line of point 1 and point 3 during the Asian session, the exchange rate will face certain pressure to adjust. The lower target is the horizontal price of point 4, and the second target is the extension line of point 1 and point 4. 

Pivot Indicator 

• According to the trading central in Ultima Markets APP, the central price of the day is established at 0.6032, 

• Bullish Scenario: Bullish sentiment prevails above 0.6032, first target 0.6050, second target 0.6061; 

• Bearish Outlook: In a bearish scenario below 0.6032, first target 0.5995, second target 0.5985. 

Conclusion 

To navigate the complex world of trading successfully, it’s imperative to stay informed and make data-driven decisions. Ultima Markets remains dedicated to providing you with valuable insights to empower your financial journey. 

For personalized guidance tailored to your specific financial situation, please do not hesitate to contact Ultima Markets. 

Join Ultima Markets today and access a comprehensive trading ecosystem equipped with the tools and knowledge needed to thrive in the financial markets. 

Stay tuned for more updates and analyses from our team of experts at Ultima Markets. 

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Disclaimer   

Comments, news, research, analysis, price, and all information contained in the article only serve as general information for readers and do not suggest any advice. Ultima Markets has taken reasonable measures to provide up-to-date information, but cannot guarantee accuracy, and may modify without notice. Ultima Markets will not be responsible for any loss incurred due to the application of the information provided.  

Willy

Willly is a skilled and experienced market analyst who has been analyzing financial markets for over 5 years. He currently serves as a Market Analyst at Ultima Markets, a leading financial services company. Willy brings a wealth of expertise in fundamental and technical analysis, having previously worked as Head of Financial Market Analyst at GCMAsia. There, he oversaw the research department and developed educational materials to build clients' financial knowledge. He also collaborated cross-functionally to amplify sales and achieve business goals. Prior to that role, Willy gained valuable experience as a Financial Market Analyst at the same company. He generated daily and weekly reports, conducted market briefings, and provided trading strategies through webinars. Read his latest market analyses on the Ultima Markets News & Analysis.

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