FxNews—New Zealand’s primary stock index, the S&P/NZX 50, increased by 0.8%, closing at 12,860 NZD this Monday. After a slow start in the morning, it reached a new peak not seen in nearly three years.
This rise was influenced by Wall Street’s strong performance the previous Friday, driven by impressive Netflix earnings and overall advances in tech stocks.
PBOC Cuts Rates to Boost Economy
A significant development occurred in China as the People’s Bank of China (PBOC) reduced its main lending rates. This move is part of a larger effort to stimulate the Chinese economy, which could impact global markets, including New Zealand.
AFT Pharmaceuticals Jumps 3.7% on New Global Deal
On the corporate scene, AFT Pharmaceuticals notably jumped 3.7% after it announced a partnership with two European companies to finalize a new injectable medicine aimed at markets worldwide. This news sparked investor interest in its potential growth.
Among the prominent companies on the NZX 50, Fisher & Paykel, a manufacturer of medical devices, saw its shares increase by 1.7%. Additionally, Ebos Group, a pharmaceutical supplier, and Infratil, an infrastructure investment company, recorded gains of 1.9% and 2.05%, respectively.
Synlait Milk Shares Plummet 8% After CEO Resigns
Conversely, Synlait Milk faced a significant setback. Its shares dropped by over 8% due to the sudden resignation of its CEO. This unexpected news raised concerns about the company’s future direction and stability.
NZDUSD Technical Analysis – 21-October-2024
According to the above image, the New Zealand dollar trades bearishly against the Greenback, below the 50-period simple moving average. As of this writing, the NZD/USD currency pair trades at approximately $0.605, posing to break below the October 3 low, the $0.604 mark.
As for the technical indicators, the market ignored the Awesome Oscillator’s divergence signal and failed to surpass the immediate resistance at $0.611 (September 11 Low). Additionally, AO bars flipped below the signal line with a red histogram, signaling that the bear market prevails.
Interestingly, the 4-hour chart from a Shooting Star candlestick pattern near the 50-period SMA interprets as bears are in control.
Overall, the technical indicators suggest the primary trend is bearish and will likely extend to lower supply zones.
NZDUSD Forecast – 21-October-2024
From a technical perspective, a new bearish wave will likely begin if bears close below the $0.604 support. In this scenario, the downtick momentum from $0.611 has the potential to spread to the August 15 low at $0.597.
Please note that the bearish outlook should be invalidated if the NZD/USD price exceeds the $0.611 immediate resistance.
NZDUSD Bullish Scenario
If bulls close and stabilize NZD/USD above the $0.611 resistance, the consolidation phase from October 16 could extend to the 100-period simple moving average at $0.617, backed by the 38.2% Fibonacci retracement level.
Also read: GBP/USD Bears Target Fair Value Gap as FTSE 100 Rises
NZDUSD Support and Resistance Levels – 21-October-2024
Traders and investors should closely monitor the key levels below to make informed decisions and adjust their strategies accordingly as market conditions shift.
- Support: $0.604 / $0.597
- Resistance: $0.611 / $0.617
J.J Edwards is a finance expert with 15+ years in forex, hedge funds, trading systems, and market analysis.