Current trend

The NZD/USD pair is correcting at 0.6006 amid a weakening American dollar and positive macroeconomic data on the New Zealand real estate market.

Thus, in September, building permits increased from –5.2% to 2.6% MoM. However, since the beginning of the year, the indicator amounted to 33.677K, 17.0% less than before. Among them, the Q3 permits increased from –2.8% to 6.2%. However, the September indicator for non-residential premises adjusted by –9.1B New Zealand dollars or by 6.4% YoY, reflecting the sector’s weakness.

The American dollar is falling during the Asian session to 103.50 in the USDX due to poor volatility in trading in anticipation of the results of the US presidential election and the decisions of the US Fed on monetary policy on Thursday. The probability of victory for the candidates from the Republican and Democratic parties is approximately equal, and investors prefer to wait and see until the election’s results. As for the meeting of the regulator, according to the Chicago Mercantile Exchange (CME) FedWatch Instrument, the probability of adjusting the interest rate by –25 basis points is 99.0%, considered in the quotes already.

Support and resistance

The trading instrument is correcting, approaching the support line of the Expanding formation pattern with dynamic boundaries of 0.6400–0.5820.

Technical indicators are holding the sell signal: fast EMAs on the Alligator instrument are moving away from the signal line, and the AO histogram is forming correction bars below the transition level.

Resistance levels: 0.6020, 0.6110.

Support levels: 0.5980, 0.5880.

Trading tips

Short positions may be opened after the price declines and consolidates below 0.5980, with the target at 0.5880. Stop loss — 0.6040. Implementation period: 7 days or more.

Long positions may be opened after the price grows and consolidates above 0.6020, with the target at 0.6110. Stop loss — 0.5980.