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Is it a good time to buy New Zealand dollars? 2022 New Zealand Dollar Trend Analysis and Investment Guide

2022-07-29
9025
What is New Zealand Dollar? Why do so many people start trading New Zealand dollars? In the recent period of time, many investors have become very interested in this currency. In fact, this currency is not a mainstream currency. There are not many people who just started trading this currency. Even now, many No one will trade this currency as a mainstream currency.

What is New Zealand Dollar?


The New Zealand dollar is the currency of New Zealand, mainly legal tender issued by the Central Bank of New Zealand. It has been officially put into use since 1967, and now it is slowly being accepted by the world, but its use area is not particularly wide, maybe because their development time is shorter, it will take more time to settle.

They belong to non-mainstream currencies, and they are also cross-distributed varieties in the trading market, so the market volume is not particularly large, and the audience is not particularly large.



What is the relationship between New Zealand dollars and Australian dollars?


Because New Zealand and Australia are particularly close, and the policies between the two countries are very different, the currencies of the two countries are almost always in a positive relationship. If the New Zealand dollar rises, then the Australian currency will also rise sharply. If the New Zealand dollar falls, then the Australian dollar will likely go out of a downward trend.

In the market, it is rare to see the New Zealand dollar and the Australian dollar go out of the opposite direction, and it is difficult to see that there will be a big difference between the two currencies.

NZD movement over the past 10 years


The trend of the New Zealand dollar in the past 10 years has been relatively stable. From the perspective of the technical structure trend, the past 10 years are mainly divided into three parts.

The first part is a downward trend, and this wave of market trends is still very fast. This wave of markets started in 2014 and continued until October 2015. The highest point was 0.8835, and the lowest point was 0.6202.



The reason why this wave of market prices will usher in a relatively large decline, and the reason why such a large decline occurred at that time, is the main reason for these factors.

The first aspect is because of the interest rate hike expectations at that time. Many people believe that New Zealand will start raising interest rates four times in a row in March. In addition, the previous trend is relatively strong, so the expectations of the entire market are still very strong. . But Australia's policy is not so anxious, hoping to develop their space stably.

The second aspect was that the commodity prices at that time were falling sharply. Especially for dairy products, the price of dairy products has dropped very fast, which has seriously affected the market economy of New Zealand, causing a large number of their items to be unable to be transported overseas normally. It also caused a huge shock to New Zealand's economy, and for several months, they were unable to successfully recover.

In the third aspect, New Zealand officials are constantly shouting on the Internet, they are particularly eager to quickly open their entire market structure, and then give them more opportunities to rebound. However, the wait-and-see mood in the market is getting stronger and stronger, and most investors are reluctant to enter the market easily.

The second stage is the stage in which the New Zealand currency continues to fall, and this wave of market has come out of a three-wave market.

This wave of market conditions has made many New Zealanders unbearable because their market conditions are so bad. The data of the entire market looks very gloomy, and the lowest point hit 0.5472 directly. This kind of market situation has already caused the investors in the market to flee frantically.



Few investors are willing to continue to develop in this market. Everyone is very worried that there will be a possibility that the market will continue to kill. If this happens, their development will be greatly threatened. It might even challenge their bottom line.

Later, with the full outbreak of the new crown virus, New Zealand quickly decided to lock down several cities. This choice also prevented their economy from rebounding quickly, which eventually led to their total economic collapse.

This is after New Zealand chose the fourth-level blockade, and the national GDP has dropped by 30%. It needs to lose at least 100 million New Zealand dollars every day, and the entire development of Auckland cannot proceed normally. In just one city in Auckland, more than 1,500 retail stores have been closed, restaurants and bars cannot operate normally, and each store needs to lose at least about $30,000.

Therefore, this wave of market conditions also caused great panic to them, and the market business in the same period could not recover quickly, and the uncertain factors continued to increase, causing their foreign export trade to begin to decrease significantly, and even the number of immigrants is also declining.

The third wave of the market is the current market. This wave of market may usher in another falling wave, and may even exceed the previous falling space, because the current falling market is still continuing.



The reason for the third decline has a lot to do with the strength of the dollar, which is now rising rapidly. The yield on the 10-year U.S. Treasury bond has exceeded 3%, and the 6-month and 12-month yields can also be close to 2%, which is already a considerable yield.

On the other hand, New Zealand's unemployment rate has hit a new high, more and more people can't find suitable jobs, and many small and medium-sized enterprises are also facing huge challenges, because starting from April 1, the minimum wage in New Zealand The price has risen sharply, and many companies cannot support it.

Where is the NZD's 10-year low? Why does this happen?


The lowest point is at 0.5472. The reason for this is that the domestic economy of New Zealand is sluggish, coupled with the huge impact of the new crown virus on their country. Under the double effect, the price of the currency cannot be normal. operation.



Is 2022 still a good year to invest in New Zealand currency?


Judging from the current technical structure trend, New Zealand's currency is still in a falling market. If you want to carry out long-term investment, this variety is not a particularly suitable choice, and when will it come out of the stable market, it is still a problem. Unknown.

As far as the current situation is concerned, the structure of the decline is intensifying. The technical structure in April has come out of a big negative line, so this wave of market should have a proper continuation.

If you want to make short-term short trades, there is still room for profit, but if you want to look at the long-term future development, now is not a particularly good choice, and the future structural trend may be floating.



Therefore, if you want to invest in New Zealand dollars, it is recommended that investors continue to wait and see, and wait for the best time to consider before thinking about it, otherwise there may be a large loss.

Summarize


The fragility of the New Zealand market has led to a downturn in the currency market. The willingness to invest is not particularly strong. Most investors are reluctant to enter this market, and many investment institutions are also watching.

The resistance level below is particularly strong. Once the low point below is broken down, it is likely to create a lower record low, so investors should be cautious.

The above information is provided by special analysts and is for reference only. CM Trade does not guarantee the accuracy, timeliness and completeness of the information content, so you should not place too much reliance on the information provided. CM Trade is not a company that provides financial advice, and only provides services of the nature of execution of orders. Readers are advised to seek relevant investment advice on their own. Please see our full disclaimer.

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