NZD/USD Got rocked by the dovish RBNZ

The New Zealand Dollar got rocкed today after the RZNB’s decision to   keep interest rates at record low level of 1.75% until September 2020, a full year later than previously projected, which was a great surprise for the markets. The NZD/USD pair sharply plunged into the deep waters, losing around 125 pips and down with 1.85% for the day. 

Alongside the US Dollar  picked up its buying interest which further supported additional downward pressure and dragged the pair to its lowest level since March 2016.

Technically speaking the short-term outlook remains strongly bearish. On the four hour time frame the price is developing well below its moving averages, all aiming south. Technical indicators favour bears to grow stronger. RSI and stochastic are showing bearish momentum and had entered into extreme negative territories. 

From the current level 0.6624 the downside risk prevails and might send the pair towards the key support at 0.6600, which seems next obvious target. On the other hand any attempts by the bulls might now confront the 0.6680 area, which if flighted is followed by the 0.6900 handle.

NZD/USD Bears are aiming 61.8% Fibo

As it was widely expected, the Reserve Bank of New Zealand left the Official cash rate at 1.75%, which has not been adjusted since 2016. The dovish statement of the central bankers triggered bearish mood for the NZD/USD pair and brought huge selling pressure. The pair is down with 0.55% today with current market price 0.6758. As seen on the four hour time frame the price is developing well below its moving averages, all of them keeping bearish slopes. RSI and stochastic are entering into extreme oversold territory but indicating that there is room for further declines. The downfall might continue towards the long-term support zone at 0.6720 (the 61.8% Fibonacci retracement of latest 0.7395 to 0.6850 bearish run) at least until the US GDP release which could move the sentiment in the opposite direction, leastways for a while.

NZD/USD The corrective rebound may proceed further weakness

Since mid April the NZD/USD pair has entered into sharp downtrend and today made a new low striking 0.7035. We are witnessing the worst losing streak for about three years. During the past two weeks the price went into free fall until today met the support provided by the 61.8% Fibonacci retracement of latest November to February bullish run. The  current market price is 0.7093, but this bounce might be considered as a corrective one and warns for further weakness. As seen on the daily chart the price is developing well below its moving averages and also keeps the downtrend that has started since late 2017. RSI and stochastic are located within extreme negative areas with no signs of getting out of there. The first resistance is provided by the 50% Fibo of same retarcement followed by the 200-day SMA at 0.7140.

EUR/NZD Pushing higher

Last week EUR/NZD was trading lower as New Zealand GDP missed market expectations. The pair bottomed at 1.6840 -1.6810 area where met the bullish trend line, starting from February 2017. So after testing for a while this significant support level finally bulls prevailed and during last sessions are showing strong upward strength. Today the pair broke the 2018 high at 0.7132 and currently is trading at 1.7154.
Technically speaking the short term outlook remains bullish. On the four hour time frame the price is developing well above its bullish moving averages. RSI and stochastic are located within extreme overbought territories and both are showing strong upward momentum.
Given the above EUR/NZD has potential to accelerate further and mark new highs. First resistance is seen at 0.7250 and a break above it will open doors for testing 1.7482. Meanwhile the upcoming session will bring the latest RBNZ monetary policy announcement with expectations to keep rates unchanged at 1.75% especially after the weak GDP numbers from last week, which will additionally support the New Zealand bulls. 

NZD/USD Bearish after soft GDP

The NZD/USD pair has been trending higher since the beginning of March and has entered into bullish channel, which was clearly broken after the New Zealand's GDP figures for the final quarter of 2017 turned to be a miss. Today the Kiwi continues to depreciate after breaking the support at 0.7250 and currently has settled at 0.7241.

Technically speaking the short term outlook remains neutral to bearish. On the four hour time frame the price is developing well below its moving averages having already bearish 20-day SMA, while the 100-day and 200-day SMAs are staying flat around respectively 0.7280 and 0.7300. RSI and stochastic are located within negative territories and both are showing strong downward momentum.
At this point  there is not much in the way of the bulls unless first retaking 0.7300 area, where is the bottom border of the channel and next 0.7350. On the flip side, it seems that the bears have taken a victorious march after breaking 0.7240 and obviously next target is 0.7200.
But will the pair succeed to break this hurdle will become clear next week when both FOMC and RBNZ rate decisions are due and that might be the catalyst for the next downward move. 

EUR/NZD Vulnerable ahead of GDP

Last week EUR/NZD surged higher and tested the significant resistance zone around 1.7130, with which bulls experience difficulties lately. Since then the pair suffered a huge drop and today was seen hovering around the key support at 1.6840.

Within the next hours the New Zealand Statistics will release the latest growth estimate with expectations of higher figures on GDP for the fourth quarter of 2017, but this optimism might play a low-down trick on the pair. 

On the four hour time frame the price is developing below its flat 100-day and 200-day SMAs, acting as first resistance at 1.6900. The 20-day SMA has eased its bearish slope and is currently located slightly above the current market price. 

RSI is hovering around 45 unable to find clear direction, while stochastic is showing string bearish momentum and is going to cross to below its mid-line.

During the upcoming session it’s very important to see how the pair will behave within the support zone at 1.6840 -1.6810. It’s a very significant area where last week’s lows met the bullish trend line, starting from February 2017. In case of breaking it to below, door are opened for testing 1.6720. On the upside the pair remains capped by the 100-day and 200-day SMAs and if bulls succeed to fight it and the to overcome next resistance at 1.7090, then we might be sure that the uptrend would hold for a while yet.

NZD/USD Shooting star and RSI divergence to define next move

Since late November 2017 the New Zealand Dollar is trying to fight against the US dollar. It’s a hard game to play. The NZD/USD pair touched its highest level since then at 0.7436, having formed a double top with the September 20 top.  Meanwhile as seen on the daily chart the New Zealand Dollar’s upwards march is hindered fundamentally by disappointing CPI figures and technically by the formed Shooting Star candlestick. Adding to this picture the RSI divergence comparing to the uptrend line staring from late December 2017.  

The pair is facing support at the 61.8% Fibonacci retracement of latest August to November down slope at 0.7260, which in case of breaking would open doors for testing the 50% Fibo of same decline at 0.7165.   

During the past weeks we witness some signs of strength towards the upside, but yet remain difficult to catch. The immediate movement of the pair is yet confined by higher highs and lows, which do not exclude a sideways consolidation. So entering short is not a good option right now having the expectations for another bulls’ intervention.

NZD/USD Lower following NZ trade deficit

New Zealand's trade deficit narrowed to $871m in October. Excluding the import of a large aircraft, the result was close to our forecast of a $600m deficit, much larger that expected. Following the unsympathetic figures, NZD/USD parked at lower side of last session’s range. On the four hour time frame the price is trapped between the 100-day and 200-day SMAs with current market price 0.6873. Sell offs during the early Asia session are pushing the pair towards south area and as seen on the same chart RSI and stochastic had retreated from the overbought areas and are displaying strong bearish momentum. The 100-day SMA is providing the first resistance level at 0.6885-0.6890 and in case of breaking it to above, the pair will resume its upward potential, that has started from the beginning if the week. But currently the pair is vulnerable around 0.6870 and additional bearish pressure would drag it lower towards 0.6820 – 0.6800. In the last trading day for the week US PMI figures later on today would spur greenback’s influence and would set more clear direction for NZD/USD.