Current trend

The NZD/USD pair is recovering from last Friday's sharp decline. The instrument is again trying to consolidate above 0.6100 amid the absence of drivers for an upward movement, so trading participants focused on the final report on the US labor market, which turned out to be significantly better than forecasts.

In May, the national economy managed to create 272.0 thousand jobs outside the agricultural sector, while analysts expected an increase from 165.0 thousand to 185.0 thousand. At the same time, investors also drew attention to the acceleration of Average Hourly Earnings in annual terms from 4.0% to 4.1% with preliminary estimates of 3.9%, and in monthly terms the figure adjusted from 0.2% to 0.4%, which also turned out to be higher than the expected 0.3%. Such dynamics indirectly indicate the persistence of inflation risks, which prevent the US Federal Reserve from returning to a looser monetary policy and may mean that this year the monetary authorities will implement only minimal plans to adjust borrowing costs, reducing it once at the end of the year. The Fed's meeting will take place on Wednesday, June 12, after which updated forecasts on interest rate dynamics will be presented for the first time in three months.

The New Zealand dollar was given some support by statistics from China published on Friday, where Exports in May added 7.6% after rising 1.5% in the previous month, while analysts expected 6.0%, and Imports slowed down sharply from 8.4% to 1.8%, below expectations of 4.2%, which led to an increase in the trade surplus from 72.35 billion dollars to 82.62 billion dollars, with preliminary estimates of 73.0 billion dollars.

Support and resistance

Bollinger Bands on the daily chart are trying to reverse horizontally. The price range is almost unchanged, but it remains rather spacious for the current level of activity in the market. MACD is going down preserving a stable sell signal (located below the signal line). Stochastic is showing similar dynamics; however, the indicator is rapidly approaching its lows, indicating the risks of oversold instrument in the ultra-short term.

Resistance levels: 0.6130, 0.6152, 0.6175, 0.6200.

Support levels: 0.6100, 0.6082, 0.6047, 0.6030.

Trading tips

Short positions may be opened after a breakdown of 0.6100 with the target at 0.6047. Stop-loss — 0.6130. Implementation time: 2-3 days.

A rebound from 0.6100 as from support followed by a breakout of 0.6130 may become a signal for opening new long positions with the target at 0.6175. Stop-loss — 0.6100.