Current trend

During the Asian session, the NZD/USD pair is testing 0.6000 for a breakdown: traders are in no hurry to open new positions ahead of the Easter weekend, including preferring to wait for the publication of the Personal Consumption Expenditures - Price Index in the US, which will be presented on Friday at 14:30 (GMT 2).

This indicator is very important for the American regulator when assessing the current inflation pressure in the country. The index is expected to adjust in February from 0.3% to 0.4% on a monthly basis and from 2.4% to 2.5% on an annual basis, while the core value could slow down from 0.4% to 0.3%. On the same day, US Federal Reserve Chairman Jerome Powell will give a speech and can comment on the prospects for lower borrowing costs in light of new inflation data. Investors are also monitoring the rhetoric of other Fed's officials. Speaking at Harvard University, Lisa Cook, a member of the regulator's Board of Governors, supported a cautious approach to easing monetary policy and noted that inflation, especially in the housing sector, remains high, but the situation is likely to stabilize in the near future. The President of the Federal Reserve Bank (FRB) of Chicago, Austan Goolsbee, in an interview with Yahoo Finance, also said that the overall indicator is declining, but price pressure in the housing market remains. In addition, the official noted that the continued rise in prices will open up the possibility of the regulator switching to "dovish" rhetoric in the coming months.

The New Zealand dollar continues to receive some support from the February foreign trade data published last Friday. Export volumes increased from 4.81 billion dollars to 5.89 billion dollars, and imports from 5.90 billion dollars to 6.11 billion dollars, which led to a reduction in the trade deficit in monthly terms from -1.09 billion dollars to –218.0 million dollars. On Thursday, February statistics on the dynamics of consumer confidence from the ANZ banking group will be presented: the previous indicator showed a moderate increase from 93.6 points to 94.5 points.

Support and resistance

Bollinger Bands on the daily chart show a steady decline. The price range is narrowed from above, being spacious enough for the current activity level in the market. MACD indicator tries to reverse to growth and to form a new buy signal (the histogram is about to consolidate above the signal line). Stochastic shows similar dynamics, retreating from its lows that signal the risks of oversold NZ dollar in the ultra-short term.

Resistance levels: 0.6000, 0.6030, 0.6049, 0.6076.

Support levels: 0.5975, 0.5950, 0.5920, 0.5885.

Trading tips

Short positions may be opened after a breakdown of 0.5975 with the target at 0.5920. Stop-loss — 0.6010. Implementation time: 2-3 days.

The return of the "bullish" trend with the breakout of 0.6030 may become a signal for new purchases with the target of 0.6100. Stop-loss — 0.6000.