The New Zealand dollar lost strength against its rivals on board after the Reserve Bank of New Zealand hiked its Interest Rate from 3.25% to 3.50% (25bps), making the New Zealand dollar the currency with the highest rate among all other currencies. However investors were shocked after dovish comments from Gov Wheeler accompanied the rate hike which caused massive sell of the New Zealand against all other currencies during last weeks trading session. Also on Friday, business confidence shows deterioration in the New Zealand economy after data came out at 39.7 from a previous of 42.8.
Weekly bias remains on the downside and further decline is expected as 21 and 55 EMA’s shows bearish continuation on the 4 hours time-frame. Also SSRC and MACD oscillators are showing signs of more decline opportunities to 0.8500 to 0.8400 psychological zones, at these regions we might probably find supports, so i expect caution to be applied in these levels.
Later in the week investors will be taking a close watch over fundamental reports that could shed more light whether more selling would continue or a reversal would emerge. Key fundamentals such as US Advance GDP q/q, ADP Non Farm Employment, FOMC Rate Statement, Non-Farm Pay Rolls and ISM Manufacturing PMI.