NZD/USD Out of Favour on RBNZ, Target April Lows?
NZD/USD is currently in a weekly and daily uptrend,
consolidating on a shorter term basis with a double top at the mid-point
of the 0.70 handle.
The nonfarm payrolls was the big event last
week that came in and disappointed the markets expecting a continuation
of the 200K+ headline. We fell well short of that yet the dollar
remained bid after a knee-jerk sell-off, and this resulted in the Kiwi
on the back-foot into the close.
The dollar is still favoured in
an otherwise dire looking global climate of economies and Central
Bankers battling with the prospects of stagflation, such as the RBNZ and
now the RBA joining the club, resulting in a better bid USD.
RBNZ to cut rates again in June? - Westpac
For
the week ahead, we will be paying attention to what RBNZ Wheeler has to
say and a number of Fed speakers, while otherwise the docket is
relatively quiet and could offer a period of consolidation on a lack of
catalysts, with risks posed to the upside should sentiment of the Fed
not being able to hike this year gathering pace.
NZD/USD levels
NZD/USD
bears remain in control within the rising channel that was established
mid-January of this year. To the downside, the 20 dma at 0.6909 was
broken last week (low 0.6807 so far) and the rising support line has
been eroded on a test of the 50 dma at 0.6819.
With the price
now back above there, it remains a support and on a convincing break
below, 0.6758 and April lows are exposed. On the flipside, a break of
the 2016 highs, the next major target comes on the weekly sticks with
Jan 2015 lows of 0.7176 ahead of the 100 weekly sma at 0.7284.
