NZD/USD – I’m picking up volume after the retest.

/Not a trade recommendation/

NZD in correction. Break to the Buy zone 0.6152 – 0.6121.

Motives :

Fundamental analysis

1. No interest rate differential – NZD – equal yield to dollar
2. Inflation in New Zealand is higher than in the States so I think the NZD may raise rates more from the Fed.
3. The Fed is likely to slow down to prevent further damage to the economy and banks.
4. The focus in the states is shifting to the growth outlook rather than inflation, which I think will change the valuation dynamics for the dollar.
5. Bank forecasts expect prices around 0.66 by the end of the year / 0.63 in Q2 / 0.629 in a 1-week period.

Long-term banking expectations

Medium-term banking expectations (Q2)

Short-term bank expectations (within a week)

Technical Analysis

1. early signs of a bounce from the 200 period daily average.
2. potential second arm of small inverse H&S.
3. Sequential in up cycle with printed 4 = more room for development of Long-a
4. DeMarker Oscillator up, despite the correction = strength of the upward movement.
5. The price is close to the key support 0.609 – 0.605 and given the fundamentals, I do not expect the price to fall below it.

Conclusion

I added to the position at the 0.616 level. Stop loss – remains at the level of 0.594, but if today’s session closes with signs of Buy Pressure (bullish hammer candle / engulfing), perhaps I will move the stop below the current low of 0.6046. Targets – 0.646 short-term, 0.66 – medium-term period at a signal for a pivot from the Fed – levels around 0.68.