The New Zealand dollar traded in the negative territory against the US dollar. The NZDUSD pair recently broke the 0.7700 support area to trade towards the 0.7650 area. There is a buying interest seen around the mentioned area, but upside should be limited considering the current market sentiment for the New Zealand dollar. So, I think selling rallies remain a good option in the short term.
There is a bearish trend line formed on the 4 hour chart of the NZDUSD pair, which might act as a resistance if the pair climbs from the current levels. So, if the pair corrects higher moving ahead, moves closer to the highlighted resistance area around the 0.7720-50 area, makes a stop and forms a bearish divergence, then we can enter into a sell trade.
Initial target should be around the 0.7640 level, and final target could be around the 0.7610 level. Stop should be placed above the trend line and resistance area.
Major events scheduled in the upcoming week
The US dollar surged higher this week as well as the economic releases in the US were on the positive side. The major one was the US nonfarm payrolls which came in above 320K, which was more than 100K from the last time. This was very positive for the US dollar which encouraged buyers to take it higher. The worst performing currency against the US dollar was the Japanese yen, which traded above the 121.00 level. All other pairs such as the EURUSD and GBPUSD also traded lower.
Let us look at all major events lined up in the upcoming week.
Sunday – Japanese GDP and Chinese trade balance data.
Monday – Swiss retail sales and CPI, Canadian housing starts and UK BRC retail sales monitor.
Tuesday – Swiss unemployment rate, German unemployment rate, UK industrial production, UK manufacturing production and Chinese CPI.
Wednesday –UK trade balance, federal budget balance, RBNZ interest rate decision and Australian employment data.
Thursday – German CPI, French CPI, US retail sales data and US initial jobless claims.
Friday –Chinese industrial production data, Spanish CPI, Euro zone industrial production, US PPI and Michigan consumer sentiment.
This analysis is taken from Weekly Market Forecast, which also includes trade opportunities on: GBPCHF, EURGBP, USDJPY, EURJPY, GBPJPY, AUDUSD, NZDUSD, AUDNZD, EURAUD, USDCAD and AUDCAD.
Get it HERE: Vladimir’s Markets Forecast
Happy trading friends!
