In today’s comprehensive EURNZD forecast, we will first examine New Zealand’s current economic conditions. Then, we will meticulously examine the EURNZD pair’s technical analysis.
Steady Ascent for The Kiwi Dollar
Bloomberg—The New Zealand dollar is approximately $0.5905 as the trading week wraps up, marking a two-week peak. This week could be the currency’s first gain after four consecutive declines. The decline in the US dollar has been a contributing factor, with market participants reassessing the possibility that the Federal Reserve may pause interest rate hikes. Eyes are on the release of the US nonfarm payroll data later today, which could influence currency movements further.
Closer to home, the Reserve Bank of New Zealand (RBNZ) held the cash rate steady at 5.5% during its early October session, marking the third unchanged rate in a row. However, the RBNZ expressed concerns about persistent high inflation despite a significant 525 basis point cumulative rate increase since October 2021. With the year’s final meeting approaching, investors are optimistic that the RBNZ will adhere to its strategy to curb the annual inflation rate, which recently stood at 5.6%, back to its target range of 1 to 3%.
Looking over to Australia, anticipation is building that the central bank will opt for a quarter-point rise in borrowing costs in the coming week and maintain a strong stance against inflation.
EURNZD Technical Analysis and Forecast
The EURNZD currency pair is currently undergoing a test at the 1.798 pivot point, having already slipped below the Kernel line on the daily chart. The RSI crossing the middle line indicates a growing bearish sentiment in the EURNZD forecast.
For a more granular perspective, we turn to the 4-hour chart. Here, the market direction is decidedly bearish, with EURNZD trading beneath the Ichimoku cloud. The pair is presently testing the 0.382 Fibonacci retracement level. Should it dip below this level, we could see the decline extend to 50% and then the 61% Fibonacci retracement level.
The Ichimoku cloud presents a resistance. EURNZD bulls would need to secure a close above the cloud to negate the bearish outlook.