NZD/USD Consolidates Near 0.5750 as Trade Deficit Narrows

In September, exports declined slightly from $5.85 billion to $5.82 billion, while imports rose from $7.08 billion to $7.18 billion. As a result, the trade deficit narrowed from –$3.06 billion to –$2.25 billion, providing modest support to the local currency. Meanwhile, credit card spending growth dropped sharply from 3.3% to 0.2%, signaling weaker consumer confidence. On a positive note, dairy prices jumped by 21.9% in early October after a 1.6% fall earlier, which could boost export income. Inflation data released earlier in the week showed the annual CPI rising from 2.7% to 3.0%, and the quarterly CPI from 0.5% to 1.0%, reinforcing expectations that the Reserve Bank of New Zealand (RBNZ) will likely maintain its current monetary stance for now.

In the U.S., the ongoing government shutdown continues, now approaching the 2019 record of 35 days. The Senate has rejected the temporary funding bill for the 11th consecutive time, though some officials expect progress later this week following nationwide protests.

Support and Resistance Levels

On the daily chart, Bollinger Bands are trending lower and narrowing, reflecting mixed sentiment in the short term. The MACD maintains a solid buy signal as the histogram stays above the signal line, while the Stochastic oscillator rises near the overbought zone around 80, suggesting a risk of short-term correction.

Resistance levels: 0.5750, 0.5775, 0.5800, 0.5832.
Support levels: 0.5722, 0.5700, 0.5672, 0.5645.

Trading Scenarios and NZD/USD Outlook

Long positions can be opened after a confident breakout above 0.5750 with a target at 0.5800 and stop-loss at 0.5722. Estimated holding time: 1–2 days.

A rebound from 0.5750 followed by a break below 0.5722 may serve as a signal for short positions with a target at 0.5672 and stop-loss at 0.5750.