NZDUSD Analysis
| Week Ending 2024-08-30 | |||
| Open | High | Low | Close |
| 0.62 | 0.63 | 0.62 | 0.62 |
| Performance | ||||||
| Period | Pct | Chg | Momentum | |||
| Friday | -0.38% | -24.1 Pips |  |
|||
| Week 2024-08-30 | 0.4% | 24.9 Pips |  August |
4.99% | 297.2 Pips |  |
Upcoming key events for the new week (London Time)
Mon 06:00 AM Labor Day 
Thu 01:30 PM Initial Unemployment Insurance Claims 
Fri 01:30 PM Nonfarm Payroll Employment
What happened over the week
The United States saw a slight increase in consumer sentiment in August, with the Michigan Index rising to 67.9 points from 67.8 points in July, as per the University of Michigan. Meanwhile, the 5-year Consumer Inflation Expectation for August held steady at 3%. The Bureau of Economic Analysis reported that the PCE Price Index rose to 0.2% in July from 0.1% in June, while the core PCE Price Index (excluding food and energy) remained unchanged at 0.2%. Additionally, personal income grew by 0.3% in July following a 0.2% increase in June. Consumer spending (PCE) saw a larger uptick, rising to 0.5% in July from 0.3% in June. On an annual basis, the PCE Price Index remained steady at 2.5%. The U.S. GDP annual rate for Q2 in the flash estimate rose to 3%, up from Q1’s 2.8%, while the GDP Price Index increased to 2.5% from 2.3%. The PCE Price Index for Q2 (excluding food and energy) dropped slightly to 2.8% from 2.9%, and the general Q2 PCE Price Index dropped to 2.5% from 2.6%.
In terms of labor market indicators, initial unemployment claims for the week ending August 24 slightly decreased to 231,000 from 232,000. The House Price Index for June dipped slightly to -0.1% from 0% in May. Durable goods orders provided mixed signals; orders excluding transportation dropped by 0.2% for July, while overall durable goods orders surged to 9.9% from the previous -6.7%. Non-defense capital goods orders, excluding aircraft, fell to -0.1% in July from a revised 0.9% in June. Meanwhile, durable goods orders excluding defense increased significantly to 10.4% from -7.2%.
In New Zealand, new dwelling consents saw a noteworthy reversal in July, rising to 26.2%, compared to the significant decline of -17% (revised from -13.8%) reported in June, according to Stats NZ.
The impacts of these economic reports on the NZDUSD currency pair are significant due to the divergence in economic signals between the U.S. and New Zealand. The positive momentum in the U.S. economy reflected in GDP growth, stable inflation expectations, and better-than-expected durable goods orders could strengthen the U.S. dollar. This contrasts with the sharp improvement in New Zealand’s housing consents, which might bolster the NZD. However, given the broader strength in U.S. economic indicators, the U.S. dollar is likely to prevail, leading the NZDUSD to maintain a downward pressure observed recently. Consequently, despite New Zealand’s positive housing data, the overall trend might reflect a stronger USD, causing NZDUSD to potentially weaken further.
From X (Twitter)
Latest release: Annual number of homes consented down 22 percent.https://t.co/rA5AJzUjZL pic.twitter.com/GEXibBK6f9
— Stats NZ (@Stats_NZ) August 29, 2024
What can we expect from NZDUSD for the new week and what happened on Friday?
NZDUSD on Friday dropped -0.38% to 0.62. Price is above 9-Day EMA while Stochastic is falling. For the week ending 2024-08-30, the pair rose 0.4% or 24.9 pips higher.
Looking ahead, NZDUSD looks bearish as the pair posted lower in Friday trading session.
For the new week, our technical outlook looks bullish, immediate upside resistance level at 0.63 (WR1) with break above could target 0.64 (WR2). On the downside, we are looking at week low of 0.62 as an important support. Break below this level could weaken the current bullish momentum. A break above 0.63 would suggest bullish bias after recent positive movement.
For the month of August, NZDUSD is up by 4.99% or 297.2 pips higher.
Weekly key levels to watch out:
| R3 | 0.64 |
| R2 | 0.64 |
| R1 | 0.63 |
| Weekly Pivot | 0.62 |
| S1 | 0.62 |
| S2 | 0.61 |
| S3 | 0.61 |
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Gross Domestic Product (Second Estimate), Corporate Profits (Preliminary Estimate), Second Quarter 2024 Source: Bureau of Economic Analysis Advance Retail Inventories Source: Census Bureau Advance U.S. International Trade in Goods Source: Census Bureau Advance Wholesale Inventories Source: Census Bureau Quarterly Financial Report – Retail Source: Census Bureau Minutes of the Board’s discount rate meetings on July 22 and July 31, 2024 Source: Federal Reserve Advance Monthly Manufacturers’ Shipments, Inventories, and Orders Source: Census Bureau