The New Zealand Dollar was at 73.07 U.S. cents from 73.11. It has dropped 1.7 % this week. Australia’s dollar was at 91.88 U.S. cents, heading for a 1.4% weekly drop. It slid 1.2% Thursday as a drop in equities discouraged carry trades. In carry trades investors buy higher yielding assets with assets from countries with relatively low interest rates, namely Japan and currently the U.S as well. Borrowing costs are near zero in the U.S. and 0.1% in Japan while interest rates are 3.5% in Australia and 2.5% in New Zealand; this disparity attracts investors to the South Pacific nations’ assets.

Australia’s currency has risen 51% in the past 12 months against the greenback, the top performing currency against the Dollar as the Reserve Bank of Australia became the first central bank to increase borrowing costs twice this year. However, investors are becoming more skeptical as to the chances of a 3rd consecutive increase this December, putting more strain on the AUD.

source:  forexyard.com

• The technical indicators used are the Slow Stochastic, MACD, and Relative Strength Index (RSI).

• Point 1: The Relative Strength Index (RSI) signals that the price of this pair currently floats in the over-sold territory, indicating upward pressure.

• Point 2: The Slow Stochastic indicates a bullish cross, signaling that the next move may be in an upward direction.

• Point 3: The MACD indicates an impending bullish cross, which may signal an upward movement is going to occur in the near future.

NZD/USD 4-Hour Chart

source:  forexyard.com