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The  New Zealand dollar  found it hard to recover after the previous blows and reached new lows. The focus is now on the bi-weekly milk auction and the ANZ Business Confidence.Here is an analysis of fundamentals and an updated technical analysis for NZD/USD.

Consumer sentiment dipped in Q1 according to Westpac. Also visitor arrivals  slowed down. On the other hand, kiwi shoppers are still on the move. In the US, data has been generally positive, with home sales leading the way. The Greek crisis has a small indirect impact on this pair as well.

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NZD/USD  daily chart    with support and resistance lines on it. Click to enlarge:

NZDUSD June 29 July 3 2015 technical New Zealand dollar analysis for currency trading forex

  1. Building Consents: Monday, 22:$5. The monthly report about building approvals provides an interesting insight into the housing sector, that has somewhat cooled down. After a slide of 1.% in April, we could see another fall in May.
  2. ANZ Business Confidence:  Tuesday, 1:00. this highly regarded  survey of 1500 businesses has been stable for quite a  while, but has  suddenly halved to 15.7 points in May. The  score for June will likely be even lower. The report tends to have a strong impact.
  3. GDT Price Index: Wednesday. The bi-weekly auction, known as the Global Dairy Trade Price Index, provides a snapshot about New Zealand’s  biggest export: milk. It fell for 7 consecutive events. Can it stabilize now? A bounce is necessary for the kiwi to bounce.
  4. ANZ Commodity Prices: Thursday, 1:00. In the past two months, this indicator of commodity prices has fallen. After a drop of 4.7% seen last time, we could see a small rise this time. Note that the milk auction has a stronger impact.

NZD/USD  Technical  Analysis

Kiwi/dollar began the week on lower ground and was only 14 pips shy of the round 0.68 level we mentioned last week. From there we did see some  stabilization, but the pair remains  beaten.

Live chart of NZD/USD:

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Technical lines, from top to bottom:

The very round  number of 0.75 capped the pair just before the big fall and serves as strong resistance. It is followed by 0.7450 that had a role in the past.

The next line is 0.7370, which was a low point in 2011. It is followed by 0.7315, which supported the pair in May.

The recent 2015 low of 0.7235 is  now the next  support line. It is followed by 0.7180 that served as resistance back in 2010.

Lower, the round level of 0.71 used to provide support in the past but was breached now. The new low of 0.7064 now works as resistance.

And of course, the very round level of 0.70 looms large and is still a battle line. It also worked as support.  roles as support.

Below,  the low of 0.6940 is another battle ground.  The round 0.69 level is a pivotal line within the range.

0.6860 was a low point as the pair dropped in June 2015. It is followed by the 0.68 level that worked as resistance when the pair was climbing a few years back.

Looking even lower, real support awaits at 0.6560, which is the post crisis low for the kiwi.

I remain  bearish on  NZD/USD

The RBNZ doesn’t let go and continued urging for a weaker currency. In addition, the fall in Chinese stocks suggests commodity prices could further suffer, even if the impact on New Zealand’s dairy exports is not as big as  on Australia’s metals.

In our latest podcast, we discuss building on the US recovery, the Greek crisis and EUR, Saudi solar and next week’s events.

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Further reading: