NZD/USD Out of Favour on RBNZ, Target April Lows?

NZD/USD Out of Favour on RBNZ, Target April Lows?

9 May 2016, 02:29
Roberto Jacobs
0
74

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.


fxs_logo_news.png

Share it with friends: