Starting from May 2017, the downward trend has been replaced by a rapid upward one. The New Zealand dollar reached its highest level at 0.72 USD over the last three months and continues to go up. The main reason for this rapid growth is a weak American dollar, which continues to be under pressure due to investigations about the possible influence of Russia on the elections in the United States. In particular, this Thursday the former head of the FBI, James Comey, will be reporting in front of the Committee of the U.S. Congress. Investors fear this can impact negatively on the administration of Donald Trump , as well as the president himself. This is why the dollar loses in value against all currencies.
The weakening of the dollar is not the only factor that affected the rate of the NZD/USD. We also received statistics about the economy of the most important trading partner of New Zealand - Australia. This week the reserve Bank of Australia left interest rates unchanged and predicts economic growth for the next few years. Meanwhile, GDP data for Australia has pleased investors: growth amounted to 0.3% in Q1 2017, while the market expected growth of about 0.2%. Also, business inventories in Australia increased by 1.2 % in Q1 2017, exceeding market expectations of 0.5% growth. This is the strongest growth since 2012.
The MACD indicates a good time for short deals. The RSI confirms this, pointing out that the rates are in the overbought zone, and there is a high probability of a price correction. But considering the fundamental factors in medium-term trading, it is better to open deals on the trend. Peak growth has not been achieved yet, and we are awaiting next week's data about volumes of retail sales and the GDP of New Zealand, which may support the NZD.
