- The Kiwi is trading in a sedate pattern as external factors dominate the balance of market sentiment for Friday.
- China’s Trade Balance release, with no set release time, will be in the driver’s seat for early Friday trading.
The NZD/USD is cycling around Thursday’s closing prices, shifting around 0.7020.
The Kiwi is facing another subdued session for Friday, with global markets focused on the upcoming G& summit that promises exposed tensions as US President Trump comes to loggerheads with his fellow world leaders over the US’ trade policies, and the upcoming China Trade Balance figures promising to drive the overall market sentiment for the Asia session.
The Kiwi has been restrained for most of this week, and as analysts at ANZ noted, market participants could be waiting for cues from the G7 meeting: “[the NZD/USD] did attempt a little higher overnight and tested resilience at 0.7060, but lacked momentum. It continues to look sidelined awaiting catalysts. Perhaps the G7 meeting this weekend, where trade will no doubt be on the agenda, could be just that.”
Westpac analysis on the upcoming China Trade Balance: “The median forecast in the Bloomberg survey is for the surplus to rise from $28bn to $33bn, with exports up 11%yr and imports up 18%yr in US$ terms. The rise in commodity prices alone should be enough to ensure swift growth in import values. China May consumer and producer price data is due Saturday. Inflation in China has not been a policy concern for some years.”
NZD/USD levels to watch
As FXStreet’s own Ross Burland noted on the Kiwi’s technical stance for Friday: “key support is located at 0.6880 while resistance is located at 0.7030. NZD/USD is trading above the 200-month moving average support at 0.6994 and weekly technicals have turned bullish while the price targets the descending 10-W SMA at 0.7079. 0.7440 comes as key upside target as the January tops, however, there is a bearish wedge formation that points to a correction and possible reversal at 0.7080. On the downside, a break of 0.7000 and 0.6980 opens risk to 0.6850/80. 0.6780 comes as next downside target meeting the lows of mid-Nov 2017.”
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