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NZDUSD range bound, with RBNZ on the horizonOn Friday, the NZDUSD traded with significant volatility as the price surged strongly to the 0.62 resistance level but failed to break above, ending the trading week at the 0.6150 price level. Early in the trading session today, the NZDUSD is trading lower with the potential to reach the 0.61 support level. Look for the NZDUSD to break the 0.6120 interim price level to signal further downside potential toward the 0.6070 key support level. Watch out for the RBNZ interest rate decision on the horizon, with a 75bps rate hike expected, this could bring significant volatility to the NZDUSD.
Short
by JinDao_Tai
1
$NZDUSD: Tight stop, big target...I think the Kiwi offers a tremendous reward to risk ratio on the short side here. The situation with persistent inflation and rising energy prices is certainly a headwind for the economy, combined with Powell's increased determination as per his last speech at Jackson Hole, has helped bears gain ground here, triggering both a daily and a weekly down trend simultaneously. The invalidation for this signal is a move back above the 0.6255 mark, in which case a short squeeze would happen. Currently, the chart signal points to a decline towards 0.5762 by October 21st, the latest. Overall, good setup in the currency market to add to a more holistic trading portfolio (like mine). Any market that adds uncorrelated returns, is a good use of leverage/cash. Best of luck, Ivan Labrie.
Short
by IvanLabrie
2
GBPNZD GAINS AS NZD DECLINESAs China reaffirmed its commitment to its zero-corona strategy, dashed hopes for an economic revival that may increase global demand, the New Zealand currency declined below $0.59, erasing gains after a robust surge. China has said that it will continue to impose restrictions in the interim. Naturally, that raises the possibility of a possible adjustment as markets progressively reopen this week. As a result, everything is "volatile, reactive, and globally fluid. Officials from the Reserve Bank of New Zealand stated that, despite warning of potential downside risks to the global economy, the country's high inflation and tight labor market call for a cooling of demand. The Reserve Bank of New Zealand increased interest rates by half a percentage point in October, but markets now expect a greater increase of 75 basis points in November.
Long
by TradeyMarkets
GBPNZD testing support + newsPrice is testing the support for the 4th time, such as MACD. We can see the columns in MACDS indicator losing power, and the line crossing each other. About candles we've a three inside up after testing the support, show us a bullish signal. And to conclude the Reerve Bank of New Zeland says "economy will slow as rising rates curb consumption", the houses prices are still expensive; and this morning in NZ we had data about unemployment and employment, and: Unemployment: 3,3%, higher thand expected (3,2%). They though the rate was lower than last Q, but is the same as the previous and higher than expected. Employment: Higher than expected with a change of 1,3bp and the forecast was 0,5% --------------------------------- Dont forget about yesterday: BOE made a £838b stimulus and sold £750m of gilts
Long
by AFCapital21
NZD higher ahead of employment reportNZD/USD is showing some strength today. In the North American session, the New Zealand dollar is trading at 0.5838, up 0.41%. Earlier today, NZD/USD rose to 0.5902, its highest level since September 21st. New Zealand releases its Q3 employment report on Wednesday. The data is expected to reaffirm that the labour market remains robust. Employment Change is expected to rise to 0.5% (0.0% prior) and the unemployment rate is forecast to tick lower to 3.2% (3.3% prior). The Reserve Bank of New Zealand is unlikely to be pleased if employment numbers improved in Q3, as it points to inflation remaining high. Moreover, business sentiment is soft, with businesses concerned about rising labor costs and many of them planning to raise their prices. Inflation in Q3 came in at 7.2%, and the RBNZ finds itself much further behind inflation than it had anticipated. The cash rate is currently at 3.5% and the hot inflation report has analysts projecting that the cash rate won't peak until 5.0% or even higher in early 2023. This leaves the RBNZ with little choice but to continue with oversize rate hikes, despite the spectre that high interest rates will tip the economy into a recession. The Federal Reserve will announce its rate setting on Wednesday, with CME's Fed Watch pegging the likelihood of a 75 bp hike at 86%. This would bring the benchmark rate to 4.0%. The question on the minds of investors is what happens next? The last meeting of the year is on December 14th and the Fed is expected to begin to ease its foot off the rate pedal, likely in the form of a 50-bp hike. This will depend on economic data, especially inflation. If inflation isn't showing any signs of peaking, the Fed will have to consider another 75 bp hike. There is resistance at 0.5906 and 0.5999 There is support at 0.5782 and 0.5689
by OANDA
AUD/NZD weakness as central bank policies divergeTo strip out the effects of the Fed we can take a look at the moves in AUD/NZD, both bolstered by risk-on sentiment. In this pair, the 25bps hike from the RBA is clearly seen as the bank underdelivering on its mandate to bring inflation back to its 2% target, a clear divergence from the RBNZ so far. The bank is due to meet on November 23rd and markets are suggesting we may see a 75bps hike this time around as inflation continued to tick higher in Q3. Similar to AUD/USD, AUD/NZD saw a spike higher on the 26th of October after the Q3 CPI data was released and rate hike odds grew in favour of 50bps. But the two central banks are starting to diverge in policy and therefore the New Zealand dollar is likely to remain dominant over the coming weeks unless we see a shift in stance from either side, whether it be in form of data or commentary from officials. The 10-year yield differential between them has also been widening which supports AUD/NZD lower and the fact that we have broken below the 200-day MA for the first time since January this year suggests the pair may continue to drop, potentially breaking below support at 1.0920.
by Capitalcom
1
NZD/USD tumbles despite RBNZ hikeNZD/USD started the day with gains but has reversed directions and is sharply lower in the North American session. The New Zealand dollar is trading at 0.5657, down 1.38%. As expected, the Reserve Bank of New Zealand delivered a 0.50% hike, bringing the benchmark to 3.50%, its highest level since 2015. The RBNZ has now hiked rates at eight consecutive meetings and even discussed a super-size 0.75% increase at today's meeting. The RBNZ has been aggressive with its rate-tightening cycle, and there's likely more to come. The rate statement noted that "core consumer inflation is too high" and the labour market remains tight, a signal that the central bank will continue to tighten until inflation has peaked. This means that the November meeting will likely bring a rate hike of 0.50% or 0.25%, depending on economic data and the inflation picture. Inflation hit 7.3% in Q2, up from 6.9 in Q1. One of the dangers of a steep rate-tightening cycle is choking off economic growth and Moody's rating agency said after today's rate hike that a soft land was "increasingly unlikely". The RBNZ might disagree, pointing to a 1.7% gain in GDP in Q2 and a robust labour market. The economy has proven strong enough to bear sharp rate hikes and Governor Orr is looking for a peak in inflation before easing up on rates. September was a disaster for the New Zealand dollar, which plunged a staggering 8.5% and fell to its lowest level since March 2020. NZD/USD has rebounded 2.0% in October, but the currency faces significant headwinds. The escalating conflict in Ukraine, which has seen President Putin annex 15% of Ukrainian territory, and a hawkish Federal Reserve are likely to continue weighing on the New Zealand dollar in the short term. NZD/USD is testing support at 0.5712. Below, there is weak support at 0.5639, followed by 0.5522 There is resistance at 0.5829 and 0.5902
by OANDA
NZD/USD - All eyes on RBNZThe New Zealand dollar continues to rally. In the European session, NZD/USD is trading at 0.5746, up 0.43%. The Reserve Bank of New Zealand holds a meeting on Wednesday. The RBNZ has been aggressive with its rate tightening and is expected to raise rates by 0.50%, which would bring the cash rate to 3.50%, the highest since 2015. Governor Orr has hinted that the rate cycle could be coming to a close soon, but that is still more work to do to tame inflation. In Q2, CPI rose to 7.3%, up from 6.9% in Q1. The economy has performed well, with GDP rising 1.7% in Q2, along with a strong labour market and solid wage growth. This means that Orr can continue to raise rates above 4.0% in the knowledge that the economy is strong enough to handle additional rate hikes. September was a disaster for the New Zealand dollar, which plunged 6.5% and fell to its lowest level since March 2020. With the US dollar taking a breather, NZD/USD has rebounded this week, with gains of 2.70%. The volatility could well continue, and the New Zealand dollar is likely to face more headwinds in the short term. First, the risk-related currency has been hit hard as risk apprehension has soared. The war in Ukraine has escalated and the energy crisis facing Western Europe could tip many countries into recession this winter. China's economy has been slowing down, which means less demand for New Zealand exports. Second, the Federal Reserve remains in aggressive mode and is committed to curbing inflation, even if that results in a recession. US Treasury yields have been on an upswing, propelling the US dollar higher against most of the major currencies. NZD/USD is testing support at 0.5712. Below, there is support at 0.5639 There is resistance at 0.5829 and 0.5902
by OANDA
#AUDNZD: Keep an eye on the basing pattern here...The weekly down trend signal in $AUDNZD expires next week, this means a potential reversal can be setting up. At the same time, the daily chart is basing and can flash a bullish signal in a day or more. I'll be watching this pair closely in the coming days, after today's close in particular. The recent bout of #NZD strength courtesy of RNBZ's hawkishness has droven the cross pair too far in my opinion and is bound to mean revert substantially, as we recover from peak pessimism when it comes to Australia and China... Cheers, Ivan Labrie.
Long
by IvanLabrie
3
NZ dollar slides below 62, retail sales nextThe New Zealand dollar continues to show volatility this week. In the North American session, NZD/USD is trading at 0.6182, down 0.48%, erasing all of Tuesday's gains. Later today, New Zealand releases retail sales for the second quarter. The markets are expecting a strong rebound of 1.7%, after the Q1 reading of -0.5%. The release is expected to reflect pent-up consumer demand after Covid restrictions were lifted in April. A stronger-than-expected release could give the New Zealand dollar a lift. The RBNZ will be carefully monitoring the retail sales release, as a strong reading would indicate that the economy remains strong and can continue to absorb higher interest rates. The RBNZ has been aggressive, raising rates by 50 basis points at four straight meetings. The central bank is expected to add another 50bp hike at the October meeting, which would bring the cash rate to 3.50%. Inflation has hit 7.3%, but the RBNZ is confident that it will peak soon and expects inflation to fall to 3.8% by the end of 2023. The central bank is cautiously positive about the economic outlook, predicting that the economic slowdown will not turn into a full-blown recession. Over in the US, durable goods orders for July were a mix. The headlines reading slipped to 0.0%, down sharply from 2.2% in June and missing the estimate of 0.6%. Core durable goods was unchanged at 0.3%. The weak data did not weigh on the US dollar, unlike the case after a weak US New Home Sales release on Tuesday, which sent the US dollar broadly lower. Investors are now shifting attention to Thursday's US Preliminary GDP for Q2. In July, the initial GDP estimate came in at -0.9%, settting off a storm of debate as to whether the US economy was in a recession after back-to-back quarters of negative growth. The debate had political overtones as well, with the White House, trying to avoid being tainted with the "R" word, went to great pains to point out that there are other definitions of a recession. The second GDP estimate is likely to come in at -0.8% or -0.9%; any other number would be a surprise and would likely result in some volatility for the US dollar. NZD/USD faces resistance at 0.6227 and 0.6366 There is support at 0.6126 and 0.6075
by OANDA
New Zealand dollar slides after RBNZ hikeThe New Zealand dollar has taken a tumble today. In the European session, NZD/USD has declined by 0.88% and is trading at 0.6289. We continue to see plenty of volatility from the New Zealand dollar. Last week, the currency rose 3.33%, but has pared those gains this week and is down 2.47%. The RBNZ dutifully raised interest rates by 0.50%, for a fourth straight time. This brings the cash rate to an even 3.00%. However, the New Zealand dollar has responded with sharp losses, as the central bank's inflation and unemployment forecasts have been revised upwards. In its monetary statement, the RBNZ said it expected inflation to start to drop from the current level of 7.3%, but said that inflation will not fall below 3% until June 2024. As well, unemployment is expected to rise to 5% in 2025. In May, the central bank projected inflation would drop under 3% in September 2023 and inflation would rise to 4.7% in 2025. The central bank holds its next meeting in October. Governor Orr flatly ruled out any predetermination as to what the RBNZ would do. Still, short of a spectacular turnaround in inflation, odds are that the Bank will deliver another 0.50% hike, as its primary focus is to ensure that inflation does not become entrenched. There is the danger that the sharp rate tightening could cause a recession, but that is a price the RBNZ is willing to pay. The Federal Reserve is doing its best to convey the message that inflation is far from beaten and additional rate hikes are coming. Since the surprising inflation report which showed a decline in CPI, the markets have been holding onto the idea that the Fed will reverse directions next year, which has sent the US dollar sharply lower. The Fed minutes will be released later today, and I expect the Fed to continue to drum out its hawkish stance. Will investors finally buy into the Fed's hawkish message or ignore what they don't want to hear? Stay tuned - the dollar could show some volatility after the release of the minutes. NZD/USD is testing support at 0.6300. Below, there is support at 0.6227 There is resistance at 0.6385 and 0.6495
by OANDA
NZD slides, employment report nextThe New Zealand dollar has reversed directions today and recorded sharp losses. NZD/USD is trading at 0.6285, down 0.75% on the day. Risk appetite has fallen, with US Speaker of the House Nancy Pelosi's controversial trip to Taiwan sending risk appetite lower. The New Zealand dollar has followed the Aussie, which has plunged around 1.5% today. As well, NZD/USD is under pressure from NZD/JPY, which is down 1% today due to safe-haven flows to the Japanese yen. New Zealand releases the employment report for Q2 on Wednesday. The labour market has been solid but unspectacular - in each of the last two quarters, Employment Change climbed by a negligible 0.1%, while the unemployment rate remained steady at 3.2%. Employment Change is expected to rise to 0.4% and the unemployment rate is forecast to tick lower to 3.1%. With the markets expecting only a slight change in the second quarter, I don't expect the New Zealand dollar to react unless the forecasts are wide off the mark. The Reserve Bank of New Zealand continues to grapple with soaring inflation, which rose to 7.3% in Q2, up from 6.9% in Q1. The central bank has raised rates to 2.50%, but with inflation well above the inflation target of around 2%, rates will have to keep rising in order to reel in inflation. The RBNZ is also concerned about inflation expectations, which if left unchecked will strengthen inflation and exacerbate the Bank's efforts to curb inflation. Inflation Expectations accelerated for eight straight quarters and hit 3.29% in Q1, up from 3.27% and a 31-year high. We'll get a look at Inflation Expectations for Q2 next week, and if the current trend continues and the reading accelerates, it will put further pressure on the RBNZ to respond with a large rate hike at the August 17th meeting. NZD/USD is putting strong pressure on support at 0.6271. Below, there is support at 0.6213 There is resistance at 0.6350 and 0.6408
by OANDA
$NZD KIWI - Where to next?$NZD KIWI - Where to next? We had the FOMC, wasn't as hawkish we are at neutral rates, we had a horrible GDP and now we are in data dependent of course, is recession priced in already? Well, time will tell but regarding NZD: Technical terms: In pennant/Bull flag a break to either direction. A break above 50 EMA - TL down we onto the bulls further in control next area of interest 1.618 areas which is a key resistance zone. I bullish FX commodity pairs and precious metals, even a crypto! (Not Investment Advice) TJ
by Trade_Journal
NZDUSD BULLISH OUTLOOKNew Zealand's CPI rose to 7.3% from 6.9% in the first quarter. This prompts analysts to believe that RBNZ will raise the interest rate with more than anticipated in order to mitigate the roaring inflation. This expectations will resume most likely till the RBNZ August meeting where the decision for the interest rate will be made. Both MACD and RSI indicators are confirming this outlook. if it gets confirmed the pair might try to test its previous resistance level at 0.6365 If not, it might plumed back to its latest low of 0.60605 Risk Disclosure: Trading Foreign Exchange (Forex) and Contracts of Difference (CFD's) carries a high level of risk. By registering and signing up, any client affirms their understanding of their own personal accountability for all transactions performed within their account and recognizes the risks associated with trading on such markets and on such sites. Furthermore, one understands that the company carries zero influence over transactions, markets, and trading signals, therefore, cannot be held liable nor guarantee any profits or losses.
Long
by legacyFXofficial
NZ dollar slides as risk sentiment fallsThe New Zealand dollar is sharply lower on Tuesday. NZD/USD is trading at 0.6261, down 1.14% on the day. New Zealand data has been mixed this week. BusinessNZ Services Index rose to 55.2 in May, up from 52.2 in April. This points to stronger expansion in the services area. However, Westpac Consumer Confidence plunged to 78.7 in May, its lowest level ever recorded. This was down from 92.1 in April. Consumers are very unhappy about the cost of living crisis and the survey found that consumers are scaling back on leisure activities, such as dining at restaurants. The double blow of higher mortgage rates and increases in living expenses has taken a large chunk of disposable income. If this results in a decrease in consumer spending, it could lead to a downturn in economic growth. Consumer angst could have a major effect on the Reserve Bank's policy. If consumer demand sinks, the central bank may have to ease off on the size of future rate hikes. The RBNZ has been tightening aggressively and the cash rate, which is currently at 2%, is expected to rise to 3% by the end of August and possibly to 4% in 12 months' time.  The RBNZ is in a fierce battle with inflation and if demand falls, inflation could peak and allow the central bank to ease up on its tightening cycle. The Bank is also monitoring inflation expectations, with policy makers keen to ensure that expectations don't become unanchored. With no US releases today, Fed Chair Powell's semi-annual appearance on Capitol Hill will take over center stage. Powell will brief lawmakers today and tomorrow, and anxious investors will be on the lookout for clues on where monetary policy is headed. Will Powell signal that he plans to ease on tightening? Powell's testimony could have a strong impact on the financial markets and should be treated as a market-mover for the US dollar. NZD/USD tested support at 0.6302 earlier. Below, there is support at 0.6209 There is resistance at 0.6408
by OANDA
NZDJPY: Improved risk outlook puts bulls in chargeNZD has gained in recent months from the market's improved risk outlook on global vaccine confidence. The NZD's recovery is being aided by China's stronger-than-expected trade figures. According to recent figures, May's imports and exports were likely positive. A rise in commodity prices benefits the currencies of commodity-producing countries. According to Bloomberg, the Reserve Bank of New Zealand (RBNZ) stated on Thursday that it will progressively sell off the government bonds bought during its quantitative easing (QE) program over the next five years. When the (RBNZ) sells bonds, the money supply is reduced because cash is removed from the economy in return for bonds. In the long run, decreasing a country's money supply leads its currency to appreciate.
Long
by TradeyMarkets
1
Today’s Notable Sentiment ShiftsUSD – The dollar rose on Wednesday, holding most of its earlier gains after minutes from the FOMC’s May meeting showed that most participants believed half-percentage-point rate increases would likely be appropriate in June and July. Commenting after the minutes’ release, BMO Capital Markets noted that “as it conducts a pair of 50 bps rate hikes during the next two months, the Fed will likely keep its cards closer to its chest, waiting to see how the outlook and risks unfold before proffering what we expect will be another strong policy signal. That is, unless further worrisome inflation developments force the Fed to lay it cards on the table.” RBNZ – New Zealand’s central bank delivered its fifth straight interest rate hike on Wednesday and signalled a much more aggressive tightening path as authorities seek to reduce the second-round effects of runaway inflation. The RBNZ raised the OCR by 50 basis points to 2.0%, a level not seen since November 2016, while also revising its projections, expecting the cash rate to double to 4.0% over the next year and remain there into 2024. Justifying its more aggressive stance, the RBNZ noted that “a larger and earlier increase in the OCR reduces the risk of inflation becoming persistent, while also providing more policy flexibility ahead in light of the highly uncertain global economic environment.”
TVC:DXY
by thunderpips
1
New Zealand dollar sinks after US CPIThis week has gone from bad to worse for the New Zealand dollar, as NZD/USD has taken a tumble on Thursday. In the North American session, NZD/USD is trading at 0.6248, down 0.74% on the day. The currency has dropped 2.66% this week and is trading at lows not seen since June 2020. The US inflation report for April showed that CPI eased, but the decline was much smaller than expected. US CPI dropped from 8.5% to 8.3%, above the estimate of 8.1%. This chilled any speculation of an '"inflation peak", as the markets digested the fact that even if inflation is moving lower, it could do so at a very slow pace. For the Fed, the high inflation reading confirms that its hawkish stance is justified, but now there are calls for policy makers to be even more aggressive in tightening the monetary screws. The Fed has signalled that it plans to deliver 50-bps increases in June and July, but the markets aren't dismissing the possibility of a massive 75-bps hike. Fed member James Bullard said on Wednesday that 50-bps moves were his base case and this appears to be the majority view. Still, inflation was higher than investors or the Fed had expected, and the May inflation report, which will be released just a few days prior to the Fed's next meeting on June 14-15th, will be critical in determining the size of the next rate hike. The Fed has embarked on a rate-hike cycle primarily because of soaring inflation, so it stands to reason that inflation will be a key factor in rate policy. Fed member Mester said on Tuesday that she supports raising rates by 50-bps at the next two meetings and then speeding up or slowing down the pace of increases based on inflation levels. The RBNZ is also under pressure to tighten more aggressively after Inflation Expectations for Q2 crept upwards to 3.29% (3.27% prior). Inflation Expectations have now risen for an eighth successive month, and the RBNZ is looking to reverse this trend. At the April meeting, the RBNZ said it would act to ensure that "current high consumer price inflation does not become embedded into longer-term inflation expectations.”  With Inflation Expectations not showing any signs of easing, the RBNZ is widely expected to raise rates by 50-bps at the May 25th meeting. NZD/USD is down sharply and has broken below support at 0.6281. Below, there is support at 0.6169 There is resistance at 0.6344 and 0.6456
by OANDA
NZ dollar steady after solid jobs reportThe New Zealand dollar is in positive territory on Wednesday, as the currency looks for its first winning session since April 20th. The New Zealand labour market remains robust, as confirmed by the Q1 employment report. The unemployment rate remained at a record low of 3.2%, matching expectations. Employment growth fell to 2.9%, (3.1% exp.), which was down from the 3.5% gain in Q1. What was perhaps more significant was wage growth, which climbed to 3.1% YoY, its highest level since 2008. The RBNZ places great weight on wage growth and this upswing will raise pressure on the central bank to deliver another 0.50% rate hike at the May 25th meeting, which would bring the Official Cash Rate to 2.0%. Inflation hit 6.9% in the first quarter and the RBNZ is determined to curb inflation expectations, which like CPI, continues to accelerate. The RBNZ delivered a 0.50% in April and has telegraphed the markets that more tightening is needed. Despite the RBNZ's hawkish stance, the New Zealand dollar has been steamrolled by its US cousin. NZD/USD plunged 6.88% in the month of April, even with the 0.50% rate hike in April. The Fed holds its policy meeting later today, with a 0.50% rate increase a virtual certainty. Such a move will be highly significant, as it would mark the Fed's largest rate increase in 20 years and demonstrates that the Fed is committed to reducing inflation, which has hit 40-year highs. The half-point increase has been priced in, but what remains uncertain is the tone of the rate statement and how aggressively will the Fed scale back its balance sheet (quantitative tightening). If the Fed delivers a hawkish message to the markets in addition to the rate hike, the US dollar will likely respond with gains. There is support at 0.6391 and 0.6325 We find resistance at 0.6519 and 0.6585
by OANDA