The New Zealand dollar managed to edge up once again, in a week that saw a lot of back and forth. Two events are on the agenda this week. Here is an analysis of fundamentals and an updated technical analysis for NZD/USD.
Milk prices advanced once again, rising by 3.5%, keeping the kiwi bid. Also, commodity prices followed with an increase. RBNZ Governor Wheeler did not say anything earth-shattering. In the US, data continued looking good enough ahead of the upcoming FED decision.
[do action=”autoupdate” tag=”NZDUSDUpdate”/]NZD/USD daily graph with support and resistance lines on it. Click to enlarge:
- Manufacturing Sales: Monday, 21:45. This is a quarterly release. In Q2, the volume of sales advanced by 2.2%, after falling beforehand. In Q3, we could see a fall.
- Business NZ Manufacturing Index: Wednesday, 21:30. This PMI-like survey has slipped to 55.2 points after 57.5 seen beforehand. A similar figure is on the cards.
NZD/USD Technical Analysis
Kiwi/dollar made a move to the upside, but was rejected at the 0.7230 line (mentioned last week).
Technical lines, from top to bottom:
The round number of 0.74 served as resistance and support back in 2015. 0.7330 was an initial high in 2016.
0.7265 was a swing high in October 2016 and works as resistance. 0.7230 served as support in September 2016.
0.7160 is a pivotal line within the range. 0.7140 worked in both directions in the past months.
0.71, a round number, was a double bottom in October. 0.7075 was a swing low in August and had a role afterward as well. It is followed by 0.7035, the low seen in October 2016.
The round level of 0.70 is still important because of its roundness but it isn’t really strong. The low of 0.6940 allowed for a temporary bounce.
I am neutral on NZD/USD
The FED is set to raise rates, but the New Zealand dollar is well positioned to withstand it.
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