NZD/USD Forecast – Can New Zealand Dollar Gains Momentum Vs US Dollar?

NZD/USD Forecast – Can New Zealand Dollar Gains Momentum Vs US Dollar?

  • – The New Zealand Dollar remains in a downtrend below 0.7280 against the US Dollar.
  • – There is a crucial bearish trend line with resistance at 0.7265 forming on the hourly chart of NZD/USD.
  • – Today in New Zealand, the RBNZ Interest Rate Decision (June 22, 2017) was announced in which the central bank kept rates at 1.75%.

 

RBNZ Interest Rate Decision

Today in New Zealand, the RBNZ Interest Rate Decision (June 22, 2017) was announced by the Reserve Bank of New Zealand. The market was positioned for no changes in rates from 1.75%.

 

The actual result was in line with the forecast, as the central bank kept rates at 1.75%. Furthermore, the Visitor Arrivals for May 2017 was released by the Statistics New Zealand. The market was expecting an increase of around 10%. However, the actual result was lower, as there was a rise of 8%. The report added that “Annual net migration reached 72,000 in the May 2017 year. Migrant arrivals numbered 130,400 and migrant departures numbered 58,400 in the year ended May 2017”.

 

Overall, the NZD/USD may find it difficult to gain pace and move above the 0.7265-70 resistance in the near term.

 

NZD/USD Technical Analysis

The New Zealand Dollar is in a minor downtrend and moved below the 0.7280 support against the US Dollar. The NZD/USD pair recently declined towards the 0.7200 handle where it found support and started correcting higher.

 

NZD/USD Technical Analysis New Zealand US Dollar

 

The pair recovered and moved above the 100 hourly simple moving average and the 38.2% Fib retracement level of the last decline from the 0.7297 high to 0.7205 low. On the upside, there is a crucial bearish trend line with resistance at 0.7265 forming on the hourly chart.

 

The same trend line resistance is near the 61.8% Fib retracement level of the last decline from the 0.7297 high to 0.7205 low. If there is a move towards the trend line resistance or 0.7265, there are chances of sellers protecting gains.

 

On the downside, the 100 hourly simple moving average and the 0.7240 level is a short-term support zone. A break below it could push the pair back towards the last swing low of 0.7210-00 in the near term.

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USD/JPY Forecast – Is This Bearish Break In US Dollar To Japanese Yen?

USD/JPY Forecast – Is This Bearish Break In US Dollar To Japanese Yen?

  • – The US Dollar had an impressive run so far this week and traded towards 111.80 against the Japanese Yen.
  • – The USD/JPY pair recently made a downside move and broke a bullish trend line at 111.45 on the hourly chart.
  • – Today in Japan, the All Industry Activity Index for April 2017 released by the Ministry of Economy, Trade and Industry posted an increase of 2.1%.

 

Japan’s All Industry Activity Index

Today in Japan, the All Industry Activity Index for April 2017 was released by the Ministry of Economy, Trade and Industry. The market was expecting the All Industry Activity Index to increase by 1.7%, compared to the last decline of 0.6%.

 

The actual result was better than the forecast, as the All Industry Activity Index increased 2.1%. However, the last reading was revised from -0.6% to -0.7%. The Indices of Construction Industry Activity posted a rise of 7.3% and came in at 118.9. And, the Indices of Industrial Production climbed up by 4% to 103.8. Lastly, the Indices of Tertiary Industry Activity increased by 1.2% to 104.8.

 

Overall, the USD/JPY pair may correct a few pips lower in the near term towards 111.00 as long as the 111.50 resistance is intact.

 

USD/JPY Technical Analysis

The US Dollar traded higher this week and broke the 111.50 resistance support against the Japanese yen to trade as high as 111.78. The USD/JPY pair later faced sellers and started a correction moving below the 111.70 support.

 

USD/JPY Technical Analysis US Dollar Japanese Yen

 

During the downside, the pair broke the 23.6% Fib retracement level of the last wave from the 110.64 low to 111.78 high and a bullish trend line at 111.45 on the hourly chart. It has opened the doors for more declines in the near term towards 111.00.

 

The pair is currently testing the 50% Fib retracement level of the last wave from the 110.64 low to 111.78 high. There is a chance of a minor jump towards the 111.50 where sellers may appear and protect gains.

 

In the short term, the pair is likely to move down and test at least 111.00 and the 100 hourly simple moving average. Below 111.00, the next support sits at 110.80.

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Market Update – June 20, 2017

Market Update – June 20, 2017

Now that the Fed’s interest rate decision and press conference are behind us, it is time to look at how the market reacted. In earnest, the U.S. dollar caught a strong bid. However, not on all the currency pairs.

 

Take the AUDUSD pair for example. For whatever the reason, the Aussie pair refuses to fall. And gold is not a reason anymore. The precious metal is way below the recent highs. Yes, the AUDUSD pair is not blinking.

 

The RBA monetary policy minutes came in line with expectations. Nothing surprisingly from the central bank. One way to explain the AUDUSD bullishness is the technical picture.

 

Commodity Currencies Well Bid

 

Not only the Australian Dollar enjoys a relative strength against its American counterpart. The Kiwi dollar and the Canadian dollar too. This makes commodities being bid while the rest of the currency on the Forex dashboard suffer.

 

The Fed’s message was very clear: the central bank keeps its hawkish tone and expects to raise interest rate even further. Moreover, the central bank announced a plan to trim down the size of its balance sheet. The overall program will be the most important one in modern central banking history. This is especially true if you think of the fact that the U.S. dollar is the world’s reserve currency.

 

The Euro fell against the dollar in another failed attempt to break the 1.13 level. In fact, the highs were 1.1295, almost taking the Trump’s election highs. For now, bears seems to be in control, but this could change in a blink of an eye as long as the 1.13 is still in sight.

 

Mixed Signals from Bank of England

 

Last week saw the Bank of England splitting votes as to wheater to raise the interest rates or not. Three members wanted a hike, which took the market by surprise. As a consequence, the GBP enjoyed a rally against all other currencies.

 

However, today, the Bank of England’s Governer, Mr. Carney, downplayed the possibility of a rate hike. Brexit negotiations just started and inflation still doesn’t warrant higher rates.

 

Conclusion

 

The Forex dashboard sends mixed signals this June. While EURUSD still sees sellers coming in, the AUDUSD pair looks bid. My take is that a triangular formation on bigger time frames forms on both pairs and the market simply consolidates, in a typical summer range. I’ll be willing to buy the dips in AUDUSD, if any, and looking for the EURUSD to jump above 1.13.

 

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USD/CHF Forecast – US Dollar Remains Supported Vs Swiss Franc

USD/CHF Forecast – US Dollar Remains Supported Vs Swiss Franc

  • – The US Dollar made a nice upside move against the Swiss Franc to trade above the 0.9730 resistance.
  • – The USD/CHF pair broke an expanding triangle pattern with resistance at 0.9740 on the hourly chart, which is now acting as a support.
  • – Today in Switzerland, the SECO Economic Forecasts (Bern, 20.06.2017) by the Swiss State Secretariat for Economic Affairs were mostly positive.

 

SECO Economic Forecasts

Today in in Switzerland, the SECO Economic Forecasts (Bern, 20.06.2017) were published by the Swiss State Secretariat for Economic Affairs. The market was expecting the agency to project the gross domestic product (GDP) to increase by around 1.3% in 2017, and by 1.9% in 2018.-

 

The actual result was mostly in line with the forecast, as the GDP is likely to grow by 1.4%, and by 1.9% in 2018. The report mentioned that “Although growth in the Swiss economy has steadily accelerated over the past two quarters, it has nevertheless fallen short of expectations”. The report also projected the unemployment rate of 3.2% in 2017 and 3.1% in 2018.

 

Overall, the USD/CHF may remain elevated, and there are high chances of a push above the recent high of 0.9762 in the near term.

 

USD/CHF Technical Analysis

The US Dollar started an upside move after trading towards the 0.9650-40 support against the Swiss Franc. The upside move was strong, as the USD/CHF pair was able to break a few resistances such as 0.9680, 0.9700 and 0.9730.

 

USD/CHF Technical Analysis US Dollar Swiss Franc

 

The pair also managed to break an expanding triangle pattern with resistance at 0.9740 on the hourly chart and the 100 hourly simple moving average. It traded as high as 0.9762 before starting a correction.

 

The pair is currently testing the 23.6% Fib retracement level of the last wave from the 0.9695 low to 0.9762 high. There is a chance of an extended correction towards the 0.9730 support or the 100 hourly simple moving average.

 

The next major support is around the 50% Fib retracement level of the last wave from the 0.9695 low to 0.9762 high. Furthermore, there is also a bullish trend line on the same chart with support at 0.9720. Overall, any dips towards 0.9740 or 0.9720 can be considered as buying opportunities in the near term.

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GBP/USD Forecast – Range Moves Head of Break in Pound to Dollar

GBP/USD Forecast – Range Moves Head of Break in Pound to Dollar

  • – The British Pound after a decline towards 1.2650 found support against the US Dollar.
  • – There is a contracting triangle pattern with resistance at 1.2800 forming on the hourly chart of GBP/USD.
  • – Today in the UK, the Rightmove House Price Index for June 2017 was released, which posted a decline of 0.4% (MoM).

 

UK’s Rightmove House Price Index

Recently in the UK, the Rightmove House Price Index for June 2017 was released. The market was positioned for a minor decline of 0.1% in the HPI compared with the previous month.

 

However, the actual result was on the lower side, as the decline was 0.4% (MoM). Looking at the yearly change, the forecast was an increase of 2% in June 2017 compared with June 2016. The actual was on the lower side, as the increase was +1.8% only.

 

Overall, the result was below the forecast, but there was no negative impact on the GBP/USD pair, as it remained above the 1.2750 support.

 

GBP/USD Technical Analysis

The British Pound was under pressure this past week, as it remained below the 1.2800 resistance against the US Dollar. The GBP/USD pair was seen trading towards 1.2650 where it found buyers and started an upside move.

 

GBP/USD Technical Analysis British Pound US Dollar

 

The pair corrected well, and moved above the 1.2700 resistance and the 100 hourly simple moving average. The pair traded as high as 1.2804 where it faced a trend line resistance. It moved down and tested the 38.2% Fib retracement level of the last wave from the 1.2691 low to 1.2804 high.

 

On the downside, the 100 hourly simple moving average is a major support at 1.2750. It also coincide with the 50% Fib retracement level of the last wave from the 1.2691 low to 1.2804 high. It seems like there is a contracting triangle pattern with resistance at 1.2800 forming on the hourly chart. The pair may consolidate for some time inside the triangle with support at 1.2750 and 1.2735. Once it succeeds in a break and close above 1.2800, there can be more upsides towards the 1.2850 in the near term.

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EUR/USD Forecast – Euro Faces Uphill Task Vs US Dollar

EUR/USD Forecast – Euro Faces Uphill Task Vs US Dollar

  • – The Euro declined sharply from the 1.1295 swing high against the US Dollar to trade towards 1.1130-20.
  • – The EUR/USD pair broke a monster bullish trend line at 1.1210 on the hourly chart to set a downtrend.
  • – Today in the Euro Zone, the CPI for May 2017 released by the Eurostat posted a decline of 0.1% (MoM).

 

Euro Zone CPI

Recently in the Euro Zone, the CPI for May 2017 was released by the Eurostat. The market was positioned for a decline of 0.1% in the CPI compared with the previous month.

 

However, the actual result was in line with the forecast, as the Euro Zone CPI declined by 0.1% (MoM). Looking at the yearly change, the forecast was an increase of 1.4%, and the result was the same. On the other hand, the Core CPI posted an increase of 1% (YoY), which was better than the forecast of 0.9%. In terms of the monthly change, there was no decline in the Core CPI in May 2017.

 

The EUR/USD pair may gain bids in the near term, but the 1.1195 and 1.1200 levels remain a major hurdle for buyers.

 

EUR/USD Technical Analysis

The Euro declined sharply after the fed interest rate decision, and moved lower by 100 pips from 1.1295 against the US Dollar. The EUR/USD pair traded below a key support area at 1.1210 and traded as low as 1.1131.

 

EUR/USD Technical Analysis Euro US Dollar

 

During the downside move, the pair broke a monster bullish trend line at 1.1210 on the hourly chart and the 100 simple moving average. After trading as low as 1.1131, the pair started a recovery and moved above the 23.6% Fib retracement level of the last decline from the 1.1295 high to 1.1131 low.

 

However, the pair is facing a major challenge near 1.1195 and 1.1200. The stated levels provided support earlier, and may now prevent an upside beak above 1.1210. The 38.2% Fib retracement level of the last decline from the 1.1295 high to 1.1131 low is also at 1.1193 to act as a resistance. Overall, selling rallies near 1.1200 can be opted with a tight stop in the near term.

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AUD/USD Forecast – Aussie Dollar Spikes Higher Post Employment Report

AUD/USD Forecast – Aussie Dollar Spikes Higher Post Employment Report

  • – The Aussie Dollar registered decent gains and moved above the 0.7565-70 resistance against the US Dollar.
  • – There is a contracting triangle pattern with resistance at 0.7630 forming on the hourly chart of AUD/USD.
  • – Today in Australia, the Employment Change figure for May 2017 released by the Australian Bureau of Statistics posted 42.0K, better than the forecast of 10K.

 

Australia’s Employment Change

Recently in Australia, the Employment Change figure for May 2017 was released by the Australian Bureau of Statistics. The market was positioned for a change of 10K in May 2017, compared to the last change of 37.4K.

 

However, the actual result was a lot better, as the Employment Change was 42K. Moreover, the Unemployment Rate in May 2017 dropped from the last reading of 5.7% to 5.5%. The report added that “Unemployment decreased 18,600 to 711,900. The number of unemployed persons looking for full-time work decreased 23,000 to 489,300 and the number of unemployed persons only looking for part-time work increased 4,400 to 222,700”.

 

It looks like the AUD/USD pair may gain traction due to the positive change, and trade above 0.7650 in the near term.

 

AUD/USD Technical Analysis

The Aussie Dollar after forming a support base near 0.7520 against the US Dollar gained pace and started an upside move. The AUD/USD pair moved nicely and was able to break a major resistance at 0.7565-70.

 

AUD/USD Technical Analysis Aussie Dollar

 

During the upside move, the pair broke the 1.236 extension of the last drop from the 0.7567 high to 0.7510 low and the 100 simple moving average. Later, the pair gained momentum above 0.7600 after the release of the Employment Change figure for May 2017.

 

At the moment, the pair is forming a contracting triangle pattern with resistance at 0.7630 forming on the hourly chart. The triangle support is near the 50% Fib retracement level of the last wave from the 0.7567 low to 0.76313 high. There is a high chance that the pair may complete the pattern and break past 0.7630 in the near term. Above 0.7630, the next target for buyers could be 0.7650. On the downside, a break below 0.7600 might call for a test of the 0.7560 support.

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NZD/USD Forecast – New Zealand Dollar Eyes New Highs Vs US Dollar?

NZD/USD Forecast – New Zealand Dollar Eyes New Highs Vs US Dollar?

  • – The New Zealand Dollar is super bullish and looking to break the 0.7225 resistance against the US Dollar.
  • – There are two important bullish trend lines with supports as 0.7205 and 0.7195 formed on the hourly chart of NZD/USD.
  • – Recently in New Zealand, the Current Account figure for Q1 2017 released by the Statistics New Zealand posted a surplus of $0.244B.

 

New Zealand Current Account

Recently in New Zealand, the Current Account figure for Q1 2017 was released by the Statistics New Zealand. The market was positioned for a trade surplus of $0.922B in Q1 2017, compared with the last deficit of $-2.335B.

 

However, the actual result was on the lower side, as the trade surplus was $0.244B in Q1 2017, but it was a lot better than the last $-2.415B (revised from $-2.335B). The report added that “For the year ended March 2017, New Zealand’s annual current account deficit was $8.1 billion (3.1 percent of GDP). As a percentage of GDP, this is the same as the deficit for the year ended March 2016 ($7.8 billion)”.

 

It looks like the NZD/USD pair may gain traction, and if it breaks 0.7225-30, there can be an upside spike.

 

NZD/USD Technical Analysis

The New Zealand Dollar moved higher recently and broke the 0.7150 resistance against the US Dollar to close above the 0.7200 handle. The NZD/USD pair is currently trading in a tight range below the 0.7225 higher, and looking for more gains.

 

NZD/USD Technical Analysis New Zealand Dollar US Dollar

 

On the downside, an initial support is around the 23.6% Fib retracement level of the last wave from the 0.7170 low to 0.7226 high. Moreover, the 100 simple moving average is also positioned on the downside along with an important bullish trend line with support at 0.7205 on the hourly chart.

 

There is one more bullish trend line on the downside at 0.7195, which is around the 50% Fib retracement level of the last wave from the 0.7170 low to 0.7226 high. Once the NZD buyers gain control and clears 0.7230, there can be solid gains towards 0.7250 or even 0.7260 in the near term. Buying dips near 0.7200 remains a good deal for now.

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Market Update – June 13, 2017

Market Update – June 13, 2017

The Forex world prepares for the much anticipated Federal Reserve interest rate decision. The market prices in a new rate hike on the U.S. Dollar.

 

While this is typically bullish for the dollar, you can hardly see that The USDCHF is struggling at weekly lows, EURUSD builds energy to pop above 1.13 and even GBPUSD found some bids on the lows.

 

Traders look for guidance and in the meantime positioning is tricky.

 

Summer Trading is Here

Let’s not forget this is June and summer trading is already here. No one takes any chances in keeping positions overnight and setting targets too far.

 

Look at the EURUSD pair, for example. Not even the ECB (European Central Bank) meeting wasn’t able to make the pair break its range. In the last one month, the pair moved in a 150-200 pips range. Maybe even less than that.

 

Expect other currency pairs to do the same this summer. However, time ticks and 1.13 looms large on the pair. These are the highs in the U.S. Presidential Election, and probably stops will get triggered on any more higher.

 

U.S. Dollar Ahead of the Fed

 

As mentioned earlier, the U.S. Dollar is in a tight spot. While it should enjoy a healthy ride, the market does exactly the opposite.

 

The fear in the market is that the Fed will deliver a dovish hike. While it would be the third hike in the recent cycle, thus confirming the tightening cycle, the tone used will be key.

 

With the U.S. equities at historical highs, the Fed will have a difficult mission to hike and to keep stocks running. A dovish hike might be the perfect solution.

 

Inflation in the United Kingdom

 

Today we had the pleasure to see the UK’s inflation at four-year highs. Anyone surprised by this should think twice.

 

With the UK equities at highs and the currency collapsing after Brexit, where would inflation be? The two are the result of inflationary forces.

 

The problem is that the Bank of England cannot do much about it. Brexit uncertainties and the current account deficit in UK won’t allow for much room to move on rates.

 

Nevertheless, the Bank of England will be hawkish moving forward. However, look for any hawkishness to be downplayed by flows in other currencies.

 

Conclusion

 

The U.S. Dollar is set for an interesting week ahead of the Fed rate hike. Look for the details in the FOMC Statement to give the future dollar move.

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EUR/AUD Forecast – Can Euro Move Into Bullish Zone Vs Aussie Dollar?

EUR/AUD Forecast – Can Euro Move Into Bullish Zone Vs Aussie Dollar?

  • – The Euro moved down this past week and traded as low as 1.4799 against the Aussie Dollar.
  • – The EUR/AUD pair is currently recovering and attempting a break above a bearish trend line at 1.4870 on the hourly chart.
  • – Recently in the Euro Zone, the German wholesale price Index for May 2017 released by the Statistisches Bundesamt Deutschland posted a decline of 0.7% (MoM).

 

Germany’s Wholesale Price Index

Recently in the Euro Zone, the German wholesale price index for May 2017 was released by the Statistisches Bundesamt Deutschland. The market was positioned for the index to increase by 0.2%, compared with the previous month.

 

However, the actual result was a lot lower, as there was a decline of 0.7%. In terms of the yearly change, the market was aligned for an increase of 3.6% in order in May 2017, but actual was +3.1%. In an another release, the Spanish Consumer Price Index for May 2017 published by the National Institute of Statistics posted a decline of 0.1% (MoM), which was in line with the market forecast.

 

If the EUR/AUD pair manages to close above the 1.4875 level, there are chances of further gains towards 1.4950.

 

EUR/AUD Technical Analysis

The Euro declined heavily this past week and traded a pip below the 1.4800 handle against the Aussie Dollar to form a low at 1.4799. The EUR/AUD pair after forming a support near 1.4800 started a recovery and moved above 1.4820.

 

EUR/AUD Technical Analysis Euro Aussie Dollar

 

Later, the pair was able to break the 23.6% Fib retracement level of the last decline from the 1.4948 high to 1.4799 low. At present, the pair is attempting a break above a bearish trend line at 1.4870 on the hourly chart and the 100 simple moving average.

 

The Euro bulls need to break the trend line resistance at 1.4870 and the 50% Fib retracement level of the last decline from the 1.4948 high to 1.4799 low in order to gain traction for an upside move towards the 1.4940-50 levels. On the downside, the pair remains supported near 1.4800, and a connecting support trend line at 1.4780.

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