Latest NZD USD Analysis and ForecastUpdated April 12th, 2021
US Dollar solid on higher relative yields; New Zealand Dollar weak, with RBNZ hawkish tone fading
- The US Dollar rebounded after immediate weakness after the 7th March Fed Meeting
- This strength resumed through March, but has seen more of a consolidation theme from late March into April
- This US Dollar strength has been assisted by US Treasuries move to higher yields, alongside US yield spread widening versus many other government bonds
- The New Zealand Dollar stays weak despite being a "risk currency" and global equity markets retaining a "risk on" tone
- This is likely due to the Reserve Bank of New Zealand (RBNZ) indicating a less hawkish (de facto more dovish) monetary policy tone
- This could encourage a further weakening of the New Zealand Dollar
Consolidation, bear bias intact
Day trade update and view
A Friday-Monday consolidation and setback from below .7069/70 resistances and whilst capped here to retain negative forces from the early April push through .7009/06, supports after the prior sell off to just hold at the March cycle low at .6941, at .6942, plus from the aggressive, latter March sell off through multiple supports (including key .7000), to leave risks lower for Tuesday.
Day trade setup
- We see a downside bias for .6995 and .6942/41; a break here maybe aims for .6895 and .6858.
- But above .7069/70 quickly aims for .7099 and opens risk up to .7142.
The late February plunge signalled an intermediate-term shift to a bear trend.
- Downside risks: We see an intermediate-term bear trend to aim for .7155, .7093 and .7000.
- What changes this? Above .7269 shifts the intermediate-term bear trend straight to an intermediate-term bull trend.
NZD USD Calendar
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14/04/21 RBNZ interest rate decision and statement
15/04/21 Australian Employment report; German CPI; US Retail Sales
16/04/21 Chinese GDP, Retail Sales & Industrial Production; EU CPIView Full Calendar
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