Current trend

Last week the NZD was affected by the controversial factors. The Consumer Price Index strongly grew to the many years maximum, but the pair didn’t reacted, being pressed by the gravitation of the strong zone, in which a year and a half trend and the level of 0.7000 coincided. From the beginning of the week the pair is weakening due to the lowering of the USD against most of the currencies. Being a commodity currency the NZD is lowering due to the reasons that weaken all the raw material assets: the growth of the EUR, the GBP and the yield of the USA bonds. Today the secondary Visitor Arrivals data grew significantly, but still didn’t change the pair dynamics.

Today and tomorrow there is no new publication from New Zealand. On Friday the key issued: New Zealand Trade balance and the USA GDP will be published. Today the USA EIA Crude Oil Stocks change data, which can affect the pair, are worth traders’ attention. Despite the expecting of the lowering of the resourced, this can support the USD. However the data will probably give the pair an additional activity, so the pair is supposed to consolidate within 0.6865-0.7000 until Friday.

Support and resistance

Support levels: 0.6910, 0.6865, 0.6800.

Resistance levels: 0.7000, 0.7075, 0.7170.

Trading scenario

Open short positions at the current price with the target at 0.6865, 0.6800, stop loss is at 0.6950.

Buy the pair from the level of 0.7000, with the target at 0.7075, 0.7170, stop loss is at 0.6930.

Implementation period: 2 days.

Scenario

Timeframe Intraday
Recommendation SELL
Entry Point 0.6910
Take Profit 0.6865, 0.6800
Stop Loss 0.6950
Key Levels 0.6800, 0.6865, 0.6910, 0.7000, 0.7075, 0.7170

Alternative scenario

Recommendation BUY STOP
Entry Point 0.7000
Take Profit 0.7075, 0.7170
Stop Loss 0.6930
Key Levels 0.6800, 0.6865, 0.6910, 0.7000, 0.7075, 0.7170

The foreign exchange market assists international trade and investments by enabling currency conversion. For example, it permits a business in the United States to import goods from European Union member states, especially Eurozone members, and pay Euros, even though its income is in United States dollars. It also supports direct speculation and evaluation relative to the value of currencies and the carry trade speculation, based on the differential interest rate between two currencies.

In a typical foreign exchange transaction, a party purchases some quantity of one currency by paying with some quantity of another currency.

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