NZD/USD Forecast – New Zealand Dollar Remains On Top Vs Dollar

NZD/USD Forecast – New Zealand Dollar Remains On Top Vs Dollar

  • – The New Zealand Dollar moved higher against the US Dollar, and currently well above the 0.7010 resistance.
  • – There is a monster bullish trend line with support at 0.7020 formed on the hourly chart of NZD/USD.
  • – The RBNZ Interest Rate Decision (March 23, 2017) was announced by the Reserve Bank of New Zealand in which the central bank announced no change in rate from 1.75%.

 

RBNZ Interest Rate Decision

Today during the Asian session, the RBNZ Interest Rate Decision (March 23, 2017) was announced by the Reserve Bank of New Zealand. The market was not expecting any reduction in rates from 1.75%, and the result was the same.

 

The outcome was positive, as helped the New Zealand Dollar to remain above the 0.7000 handle against the US Dollar. A few key points from the official release – “Global headline inflation has increased, partly due to a rise in commodity prices, although oil prices have fallen more recently”, “Quarterly GDP was weaker than expected in the December quarter, but some of this is considered to be due to temporary factors” and “Monetary policy will remain accommodative for a considerable period.”

 

Overall, the New Zealand Dollar remains supported for more gains above the 0.7050 level in the near term with a chance of a move towards 0.7100.

 

NZD/USD Technical Analysis

The New Zealand Dollar managed to stay in the bullish trend with a move above 0.7010 against the US Dollar. The NZD/USD pair was successful in breaking the 100 hourly simple moving average at 0.7030, resulting in a positive bias.

 

NZD/USD Technical Analysis New Zealand US Dollar

 

The pair is trading above the 0.7010 support and the 100 hourly simple moving average. Moreover, there is a monster bullish trend line with support at 0.7020 formed on the hourly chart. So, we can say that the pair is well above the 0.7010-0.7020 support area, and looking to extend gains.

 

It is already above the 23.6% Fib retracement level of the last drop from the 0.7072 high to 0.7025 low. So, there is a chance of it moving higher towards a bearish trend line at 0.7060 on the same chart. A break above it could ignite a move towards the 0.7083 level. It represents the 1.236 extension of the last drop from the 0.7072 high to 0.7025 low.

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USD/CHF Forecast – US Dollar To Extend Declines Vs Swiss Franc

USD/CHF Forecast – US Dollar To Extend Declines Vs Swiss Franc

  • – The US Dollar fell sharply against the Swiss Franc recently after clearing the 1.0060 support area.
  • – The USD/CHF pair broke a major bullish trend line with support at 1.0080 on the 4-hours chart.
  • – The Swiss Trade Balance for Feb 2017 released by the Federal Customs Administration posted a trade surplus of 3.11B, less than the forecast of 3.850B.

 

Swiss Trade Balance

Today in Switzerland, the Trade Balance for Feb 2017 was released by the Federal Customs Administration. The market was expecting the balance amount between import and export to post a surplus of 3.850B in Feb 2017, compared with the previous 4.73B.

 

The outcome a bit lower than the forecast, as the Swiss trade surplus in Feb 2017 was 3.11B. The last reading was revised to 4.83B. The Swiss Exports of goods and services in Feb 2017 declined by 2.2%, compared with the last -3.6%. Moreover, the Swiss Imports of goods and services in Feb 2017 increased 2.9%, compared with the last -3.9%.

 

Overall, the result neutral, and might not have a negative impact on the Swiss franc, which means USD/CHF might continue heading lower towards 0.9920.

 

USD/CHF Technical Analysis

The US Dollar was under a lot of bearish pressure recently against the Swiss Franc, as it moved below 1.00. Earlier, the USD/CHF failed to hold an important support area near 1.0060. It resulted in a sharp drop of more than 100 pips.

 

USD/CHF Technical Analysis Dollar Franc

 

During the downside move, the pair broke a major bullish trend line with support at 1.0080 on the 4-hours chart. It also moved below the 100 simple moving average on the same chart at 1.0085. It traded as low as 0.9942 from where it recovered. However, the recovery failed near the 23.6% Fib retracement level of the last drop from the 1.0170 high to 0.9942 low.

 

The pair is once again moving down, and might retest the recent low of 0.9942. And, if the US Dollar sellers remain in action, there is even a chance of a break below 0.9940 for a move towards 0.9920 or 0.9900. On the upside, the 1.00 is the most important resistance area where sellers might appear.

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Market Update – March 21, 2017

Market Update – March 21, 2017

The second part of March started with markets being still in a range as nothing the central banks say or do seem to move prices anymore. This month so far there were three main events that were supposed to bring volatility to the trading table: the European Central Bank (ECB) meeting, the Non-Farm Payrolls (NFP) in the United States and the Federal Reserve decision.

 

None of them was enough to break recent ranges. Despite the fact that the Fed did hike the rates, the dollar is not enjoying it. This may be because the decision was already priced in, in the sense that the communication was so clear that everyone knew the Fed will hike rates, and then when the actual hike came, the opposite happen: the dollar was sold instead of being bought.

 

It may be that market participants are still waiting for another reason until the next move unfolds. One thing is for sure: since Mr. Trump’s election, the market is ranging.

 

It may be too much to say that the market is ranging for almost four months now, but if you look at the daily time frame on most of the major pairs you’ll see this statement is correct. The EURUSD, while trading with a bullish tone, is not able to break higher, despite the fact that it is eyeing the 1.08 level now.

 

The USDCHF pair is trading around the parity level, with sellers pushing the pair below the level on any meaningful attempt to break higher. And even USDJPY is ranging on the daily chart.

 

When majors are ranging, chances are that the crosses will be in a range as well. This is true if you look at the EURJPY and EURGBP crosses. While they enjoyed a nice rally in February, time passed and more than half of those gains were retraced.

 

The other day marked the beginning of a new era. The United Kingdom has officially announced that on March 29, 2017, the now famous Article 50 will be triggered. For those that are unfamiliar with the subject, this is the official document that marks the break-up of the United Kingdom from the European Union.

 

Markets took it surprisingly well. Both the Euro and the Pound didn’t move on the news. However, expect this to change the more we find out more details about the next steps to come.

 

CPI in Canada and TLTRO in Eurozone should make this week a bit more volatile towards the end. Hopefully, ranges will be broken and we can all move on.

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EUR/GBP Forecast – Can Euro Hold This Vs British Pound?

EUR/GBP Forecast – Can Euro Hold This Vs British Pound?

  • – The Euro after failing near the 0.8788 level against the British Pound moved down.
  • – The EUR/GBP pair is currently trading near a bullish trend line with support at 0.8650 on the 4-hours chart.
  • – The German Producer Price Index released by the Statistisches Bundesamt Deutschland posted a rise of 0.2% in Feb 2017, compared with the previous month.

 

German Producer Price Index

Today in the Euro Zone, the German Producer Price Index for Feb 2017 was released by the Statistisches Bundesamt Deutschland. The market was expecting the average changes in prices in the German primary markets to increase by +0.2% in Feb 2017, compared with the previous month.

 

The outcome in line with the forecast, as the German Producer Price Index increased 0.2% in Feb 2017. In terms of the yearly change, there was a rise of 3.1% in Feb 2017, compared with Feb 2016. It was more than the forecast of +2.9%, and more than the last +2.4%. The report mentioned that “Energy prices increased by 5.4%, though prices of the different energy carriers diverged. Prices of petroleum products increased by 22.7%, whereas prices of natural gas (distribution) decreased by 7.5%’.

 

Overall, the result was better for the Euro, which may help EUR/GBP in gaining bids near 0.8650 in the short term.

 

EUR/GBP Technical Analysis

The British Pound struggled a lot against the Euro, as EUR/GBP climbed above a couple of important resistances like 0.8600 and 0.8700. The pair traded towards 0.8800, but failed to break the 0.8788 level. There were two attempts to clear 0.8788, but the Euro buyers failed to surpass it.

 

EUR/GBP Technical Analysis Euro Pound

 

As a result, there was a downside move, and the pair moved below 0.8750. Later, it broke a bullish trend line on the 4-hours chart at 0.8720. And, finally there was a move below the 23.6% Fib retracement level of the last wave from the 0.8402 low to 0.8788 high.

 

At the moment, the pair is trading near a bullish trend line with support at 0.8650 on the 4-hours chart. The same trend line is also above the 100 hourly simple moving average at 0.8640. So, we can say that the pair is trading above a major support at 0.8650-0.8640. It might bounce or break it for more losses.

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Market Update – March 14, 2017

Market Update – March 14, 2017

One day ahead of the all-important Federal Reserve’s decision, the markets are in a consolidation mode. That is, almost all markets!

 

Currency pairs enjoyed higher volatility levels as last week both the ECB press conference and the NFP in the United States were due. The ECB delivered a hawkish statement, while the NFP was beating expectations across all metrics.

 

As mentioned above, the ECB delivered a hawkish statement for the Euro, in the sense that, for the first time in a long period, things are not that gloomy anymore. GDP is rising at a nice pace, inflation picks up, and consumer spending is increasing as well.

 

Moreover, unemployment level is shrinking across Europe and loans to businesses are on the rise. What can go wrong for the Euro?

 

The answer is the dollar. The U.S. dollar and the U.S. economy is preparing for a new rate hike from the Fed. This rate hike will only make the interest rate differential between the two powerhouses to widen some more.

 

At -0.5% in Eurozone and 0.75% in the United States, the gap is quite big. Expect it to become even bigger if the Fed delivers.

 

The NFP last week came after a staggering ADP number that beat expectations by a mile. Pressure mounted that the NFP will print higher as well, and it did, with the unemployment rate further falling to 4.7%.

 

As part of the Fed’s mandate, the jobs data is crucial for any shifts in the monetary policy. We can say the NFP confirmed the Fed’s hawkishness lately.

 

It is no wonder, then, that the market is pricing in a 100% probability for the Fed to hike rates. Some will go even further and say that the rate hike is priced in.

 

This cannot be further from the truth. While the Fed spent a lot of time in communicating the market its intentions, the U.S. dollar’s reaction is unknown. It is one thing to expect something and another thing to see the rates really moving to the 1% level.

 

Inflation is picking up, the labor market is approaching full employment…it is no wonder the tightening cycle continues. The Fed is clearly looking to stay ahead of the curve, so I wouldn’t be surprised to see a hawkish statement at the press conference to follow the FOMC release.

 

If that is the case, the U.S. dollar should be on fire. Expect it to have more legs against the GBP, due to the Brexit thing, as this March the U.K. is supposed to trigger the Article 50.

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GBP/USD Forecast – British Pound Looking To Gain Traction Vs Dollar

GBP/USD Forecast – British Pound Looking To Gain Traction Vs Dollar

  • – The British Pound after a nasty decline found support near 1.2140 against the US Dollar.
  • – The GBP/USD pair is currently recovering, and facing a major resistance trend line at 1.2180 on the hourly chart.
  • – The UK’s Trade Balance figure for Jan 2017 released by National Statistics posted a trade deficit of £-2.447B, less than the forecast of £-2.50B.

 

UK Trade Balance

Today in the UK, the Trade Balance figure for Jan 2017 was released by National Statistics. The market was expecting the balance between exports and imports of total goods and services to be £-2.50B in Jan 2017.

 

The outcome was better than the forecast, as the UK’s Trade Balance posted a trade deficit of £-2.447B. The good trade balance was also above the forecast with deficit of £-10.833B in Jan 2017. The report mentioned that “Between the 3 months to October 2016 and the 3 months to January 2017, the total trade deficit (goods and services) narrowed by £4.7 billion to £6.4 billion”. In another release, the UK Industrial Production released by the National Statistics posted a rise of 3.2% in Jan 2017, compared with Jan 2016. It was a point lower than the forecast of 3.3%.

 

It looks like the British Pound is attempting a recovery, but might struggle to break the trend line resistance near 1.2180.

 

GBP/USD Technical Analysis

The British Pound struggled a lot lately and moved below 1.2200 against the US Dollar. The GBP/USD pair fell towards 1.2140 where it found support and started a consolidation. The pair traded in a range for some before moving higher.

 

GBP/USD Technical Analysis Pound US Dollar

 

It already made an attempt to settle above the 1.2200 handle, but failed. There was also a failure near the 38.2% Fib retracement level of the last decline from the 1.2300 high to 1.2133 low. At the moment, the pair is struggling to clear a major resistance trend line at 1.2180 on the hourly chart.

 

If there is a break above 1.2180, the pair might test the second trend line resistance at 1.2195, which also coincides with the 100 hourly simple moving average. On the other hand, if the pair fails once again, there can be a retest of 1.2140.

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AUD/USD Forecast – Aussie Dollar Likely Heading Towards 0.7480

AUD/USD Forecast – Aussie Dollar Likely Heading Towards 0.7480

  • – The Aussie dollar was under heavy pressure with a break below 0.7540 against the US Dollar.
  • – There is a crucial bearish trend line with resistance at 0.7580 on the 4-hours chart of AUD/USD.
  • – The Chinese Consumer Price Index released by the National Bureau of Statistics of China posted a decline of 0.2% in Feb 2017, compared with the +0.6% forecast.

 

Chinese Consumer Price Index

Today in China, the Consumer Price Index for Feb 2017 was released by the National Bureau of Statistics of China. The market was expecting the Chinese Consumer Price Index to increase by 0.6% in Feb 2017, compared with the previous month.

 

The outcome was well below the forecast, as the Chinese Consumer Price Index registered a decline of 0.2% in Feb 2017, which was also lower than the last +1%. In terms of the yearly change, the CPI increased 0.8% in Feb 2017, compared with the same month a year ago. It was also disappointing, as the market was aligned for a 1.7% rise.

 

The result was discouraging, and weighed on the Aussie dollar, and AUD/USD extended its decline below the 0.7530 support area.

 

AUD/USD Technical Analysis

It is a clear downtrend in the Aussie dollar since there was a break below the 0.7600 handle against the US Dollar. The AUD/USD pair declined heavily and broke the 0.7580, 0.7550 and 0.7530 support levels, igniting a solid downside move.

 

AUD/USD Technical Analysis Aussie US Dollar

 

The pair has already broken the last swing low at 0.7542. It also cleared the 1.236 extension of the last wave from the 0.7542 low to 0.7632 high. So, there are chances of more declines in the near term.

 

If there is a break below the 0.7500 handle, the pair could easily test the 1.618 extension of the last wave from the 0.7542 low to 0.7632 high. In that case, the 0.7480 support may come into play and try to prevent downsides. On the upside, the last swing low at 0.7540 is now a resistance zone. If there is a recovery in AUD/USD, then the 0.7540 and 0.7560 levels might act as a hurdle for buyers in the short term.

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NZD/USD Forecast – New Zealand Dollar Under Significant Pressure

NZD/USD Forecast – New Zealand Dollar Under Significant Pressure

  • – New Zealand Dollar was crushed recently against the US Dollar for a move below 0.7000.
  • – The NZD/USD pair is following a monster descending channel pattern with resistance at 0.6970 on the hourly chart.
  • – The New Zealand Manufacturing sales, released by Statistics New Zealand posted a decline of 1.8% in Q4 2016, compared with the last +2.1%.

 

New Zealand Manufacturing Sales

Today in New Zealand, the Manufacturing sales report for Q4 2016 was released by Statistics New Zealand. The market was expecting the volume of the physical output of the nation’s factories, mines and utilities to increase by around 1% in Q4 2016.

 

The outcome was well below the market expectation, as the New Zealand Manufacturing sales registered a decline of 1.8% in Q4 2016. The report added that the “volume of meat and dairy product manufacturing fell in the December 2016 quarter, although sales values rose due to higher prices”. In China today, the trade balance figures for Feb 2017 were released. They also failed to impress with a trade deficit of -60.4B CNY, compared with the last surplus of 354.5B CNY.

 

Overall, the New Zealand dollar is likely to remain under bearish pressure, and could trade towards 0.6900 against the US Dollar in the near term.

 

NZD/USD Technical Analysis

There was a solid downside move in New Zealand dollar, as it tumbled below 0.7040 and 0.7000 support levels vs the US Dollar. The NZD/USD pair is under heavy pressure, and following a monster descending channel pattern with resistance at 0.6970 on the hourly chart.

 

NZD/USD Technical Analysis New Zealand US Dollar

 

The pair is currently attempting a recovery from the 0.6935 low, but likely to face sellers near the 0.6970 or 0.6960 level. The same level also coincides with the 23.6% Fib retracement level of the last decline from the 0.7045 high to 0.6934 low.

 

No doubt, the pair remains at a risk of more downside, and it could trade close to the 0.6900 level. The current descending channel clearly highlights the bearish pressure, and a break below 0.7000 could spark further downsides. If you are a seller, look to sell rallies, but protect it when there is a change in the trend or RSI moves back above the 50 level.

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EUR/USD Forecast – Euro Likely To Break Down Vs Dollar

EUR/USD Forecast – Euro Likely To Break Down Vs Dollar

  • – There Euro was seen struggling to clear a major resistance near 1.0630 against the US Dollar.
  • – The EUR/USD pair is currently attempting a break below a crucial bullish trend line at 1.0585 on the hourly chart.
  • – The German Factory orders released by the Deutsche Bundesbank posted a decline of 7.4% in Jan 2017 (MoM), compared with the -2.7% forecast.

 

German Factory Orders

Today in the Euro Zone, the German Factory orders for Jan 2017 was released by the Deutsche Bundesbank. The market was expecting the shipments, inventories, and new and unfilled orders to decline by around 2.7% in Jan 2017, compared with the previous month.

 

The outcome was well below the forecast, as the German Factory orders posted a decline of 7.4% in Jan 2017. In terms of the yearly change, there was a decrease of 0.8% in Jan 2017, which was a lot lower compared with the last increase of 8% (revised). In Italy today, the Producer Price Index for Jan 2017 (MoM) was released by the National Institute of Statistics. The result was around the forecast, as the Producer Price Index posted a rise of 1% in Jan 2017, compared with the previous month.

 

Overall, the Euro has hardly any reason to remain supported, which means the EUR/USD pair could trade towards 1.0550 in the short term.

 

EUR/USD Technical Analysis

There was a rise in the Euro towards 1.0630-1.0640 against the US Dollar where it found resistance. The stated resistance near 1.0630 acted as a barrier on many occasions. It prevented gains once again in EUR/USD and pushed the pair back below 1.0600.

 

EUR/USD Technical Analysis Euro US Dollar

 

The pair also moved below the 23.6% Fib retracement level of the last wave from the 1.0494 low to 1.0639 high. At the moment, it is attempting a break below a crucial bullish trend line at 1.0585 on the hourly chart.

 

If there is a close below the trend line support or 1.0580, there is a chance of a move towards 1.0550. The pair may even test the 61.8% Fib retracement level of the last wave from the 1.0494 low to 1.0639 high or the 100 hourly simple moving average around 1.0550. Overall, the pair remains at a risk of a breakdown in the near term.

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