Kiwi Slips As China Data, US Dollar Weigh

Fundamental Analysis

* Weak Kiwi: The New Zealand Dollar continues to weaken against the U.S. Dollar, facing pressure from deflation concerns in its largest trading partner, China. Uncertainty around Beijing’s economic stimulus plans has raised doubts about future demand. On Sunday, China’s National Bureau of Statistics reported that the country’s monthly Consumer Price Index (CPI) remained flat at 0% in September, following a 0.4% rise in August. Meanwhile, annual inflation grew by 0.4%, below the forecasted 0.6%. Additionally, the Kiwi is being weighed down by U.S. dollar strength, supported by rising expectations that the Federal Reserve will slow the pace of rate cuts more than previously anticipated.

Technical Analysis

* Technical Breakout: NZDUSD was traded lower following prior retracement from the resistance level 0.61000. MACD which illustrate diminishing bullish momentum signal suggest the pair to likely extend its losses further.

*Resistance and Support: If the bearish momentum persists, there’s a strong likelihood that the price will potentially head towards the level 0.59850. Conversely, a potential reversal is also to be expected and the price could head back towards 0.61850 after it breach above the level 0.61000.

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Potential Risks

Looking ahead, investors will be closely monitoring key U.S. data releases, particularly Retail Sales, which could provide further insights into the economic outlook. In addition, attention will remain on the economic developments in New Zealand’s key trading partners, China and Australia, as shifts in their economic performance could influence the Kiwi’s movement.

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Monitoring

Stay updated on US and China data, central bank updates and any shifts in the US Dollar’s strength by following PU Prime’s market insights and daily financial news.

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Disclaimer: Trading derivatives involves high risks, and market conditions can change rapidly. The content is for informational purposes only and should not be considered as financial advice. Traders should conduct their own research and consider risk management strategies.