Search ForexCrunch

According to Jason Wong, Senior Markets Strategist at BNZ, the NZD/EUR pair is facing resistance ahead to make further progress after a strong run in the cross since October.

Key Quotes:  

“The cross is trading below its average since 2012, following the steep fall through 2017. Has settled in a 0.56-0.61 range since late-2017. 0.56 is a strong support level, having spent very little time below that level since 2011. 0.61-0.6120 represents a key resistance level.”

“Reflecting safe-haven characteristics for the euro, NZD/EUR generally weakens in a falling risk appetite environment. Risk appetite has improved this year, stretching back up to an above-average level. A sustained period of risk aversion would be a headwind for the cross.”

“Sentiment for EUR has been subdued, not helped by the recent run of poor data, and it wouldn’t take much to see some improvement.”

“Our bias is for NZD/EUR to head lower, targeting about 0.57 through the next year. Reduced Brexit risk (spillover from GBP) would support this view.”