Soft US inflation spur bulls into NZDUSD.
“Lower inflation in US prompts major shift in sentiments across the board.”
Kiwi received higher demand overnight as investors shifts their focus following the release of US inflation data. According to Bureau of Labor Statistics, US inflation increased by 8.5%, slightly lower than forecast of 8.7%. The data prompts investors to flock away from safe havens, favoring risky assets such as the kiwi. On the other hand, New Zealand’s inflation rate came in lower than previous month’s reading with 3.07% vs 3.29%. However, we expect Reserve Bank of New Zealand to continue their policy tightening as planned.
Quick recap on NZDUSD
Overall structure of the pair is skewed towards the downside while recent price action suggests possible shift.
NZDUSD Weekly Technical Analysis
From weekly perspective, NZDUSD rose significantly after staging a rebound near the 0.6100 marl.
NZDUSD Daily Technical Analysis
The pair has successfully breakoff downward trendline, while testing at the next hurdle of 0.6400.
ORDER: BUY STOP
STOP LOSS: 0.6360
Target 1: 0.6500
Target 2: 0.6555
ZFX Analyst’s Comment
Recent price action and closure above downward trendline suggests possible extension of bullishness ahead. However, we will require a confirmatory close above 0.6400 before entering the market.
Risk Warning: The above content is for reference only, and does not represent ZFX’s position. ZFX does not assume any form of loss caused by any trading operations carried out in accordance with this article. Please be firm in your thinking and do the corresponding risk control.
ZFX (Zeal Capital Market) is an FCA & FSA licensed online Forex & CFD broker providing more than 100 products for Forex, commodities, stock indices, and share CFDs. Open a trading account with min. USD 50 deposit and download our MT4 trading platform now!