The kiwi had an outstanding week, climbing back above 0.80. Credit card spending is the main event this week. Here’s an outlook for the events in New Zealand, and an updated technical analysis for NZD/USD
Last week brought a positive reading for NZ housing industry. The real estate institute of New Zealand released its house price index rising by 1.7% from 0.5% increase in the previous month indicating increasing activity in the market. Will this trend continue?
NZD/USD daily chart with support and resistance lines on it. Click to enlarge:
- Visitor Arrivals: Thursday, 21:45. August was a busy month at the gates of New Zealand as 92,752 visitors entered the country. The huge climb was due to rugby fans arriving ahead of the World Cup. The number of visitors leaped by 8.0% following, an even higher, figure of 8.8% in the previous month. The government predicts the rugby tournament will inject $700 million into the economy. A smaller figure is predicted.
- Credit Card Spending: Friday, 2:00. Credit card spending increased by 4.7% in August from a year ago following 7.2% rise in the previous month. This is the first decline in 5 months. The same reading is expected.
* All times are GMT.
NZD/USD Technical Analysis
The kiwi continued its ride north. After stopping to rest on top of the 0.7895 line (mentioned last week), the pair move higher and eventually closed above the round 0.80 line.
Technical lines from top to bottom:
We start from higher ground now. 0.8505 is also a notable point which provided a temporary cushion for the pair when it traded higher. It is now weak resistance. It is followed by 0.8410 – which was a stubborn line of resistance is already a stronger line.
0.8330 has a more important rose now after capping a surge higher. 0.8275 has worked as support in August and in September, and is also of higher importance of capping the pair for some time. It serves as immediate support.
0.8180 provided support in July and also in September 0.8120 was a double bottom before the fall and also provided some support in June.A break above this line will be of importance
0.8090 worked as support in June and in July and is immediate resistance now. Below, 0.7975 was a long running peak and provided support back in May and in July. It was run through during the downfall.
0.7895 was minor support in May and is more important support now. It was tackled also in September. A more important line is 0.7825. It capped the pair three times, in January and in September, and provided support in April. This is an area of struggle.
0.7764 was important support in May and managed to slow down the fall. It is weaker now, after being run through. 0.7655 was significant resistance back in February and also in 2010 and is now support once again.
0.7524 was an important line of support at the beginning of the year, and later switched to resistance. It provided some support in October as well. The fresh low of 0.7468 seen in October is a strong line of support.
I am bearish on NZD/USD.
Despite the good news from China regarding softer inflation, the recent jump of the New Zealand dollar is a bit overwhelming and a correction is more likely now .
Further reading:
- For a broad view of all the week’s major events worldwide, read the USD outlook.
- For EUR/USD, check out the Euro to Dollar forecast.
- For the Japanese yen, read the USD/JPY forecast.
- For GBP/USD (cable), look into the British Pound forecast.
- For the Australian dollar (Aussie), check out the AUD to USD forecast.
- For USD/CAD (loonie), check out the Canadian dollar
- For the Swiss Franc, see the USD/CHF forecast.
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