We use a range of cookies to give you the best possible browsing experience. By continuing to use this website, you agree to our use of cookies.
You can learn more about our cookie policy here, or by following the link at the bottom of any page on our site.

Free Trading Guides
EUR/USD
Bullish
Oil - US Crude
Bearish
Wall Street
Mixed
Gold
Bullish
GBP/USD
Bullish
Low
High
of clients are net long.
of clients are net short.
Long Short

Note: Low and High figures are for the trading day.

Data provided by
USD/JPY
Bullish
Low
High
of clients are net long.
of clients are net short.
Long Short

Note: Low and High figures are for the trading day.

Data provided by
More View more
Real Time News
  • Support and resistance are the cornerstone of technical analysis, making it the foundation that you build your knowledge on. Build a stronger foundation here: https://t.co/yXLaRpl90I https://t.co/MhP7opgk4a
  • Investors in stocks, commodity currencies and energy have been praying for a massive fiscal bazooka to combat the virus effects. It looks like they’re going to get it. Get your market update from @DavidCottleFX here:https://t.co/e2ciGSYftY https://t.co/Udoi5UMJrl
  • The ‘V-shaped’ recovery in USD/JPY just failed to hit its target and is now moving lower again. Important support is now being tested. Get your $USDJPY technical analysis from @nickcawley1 here: https://t.co/koiac0Rxvs https://t.co/CsVsS7PVMV
  • The Australian Dollar has been lifted from its multi-year lows by hopes that global financial authorities can fend off the worst of the #coronavirus‘ effects. Get your $AUDUSD market update from @DavidCottleFX here: https://t.co/GC5pwNbY9S https://t.co/OryobNq7uL
  • Before considering to enter a position, price action must come into contact with the upper or lower channel line at least three times. Learn how to validate a channel here: https://t.co/Rd5hDm7gRo https://t.co/mubPgmDRRY
  • A tidal wave of cash waits to return to virus-battered assets, backstopped by huge stimulus. It is unlikely to deploy until infection slows, whatever the US administration prefers. Get your market update from @DavidCottleFX here: https://t.co/OWOi2HxejD https://t.co/jvMXT7te1h
  • The bullish engulfing candle is one of the forex market’s most clear-cut price action signals for reversals and continuation. Learn more about this price action trading signal here: https://t.co/edEHzyoCJT https://t.co/vHPSW7Vm96
  • It was a big week for GBP/USD as Cable crushed shorts, rallying more than 1,000 pips off of last week’s lows. Get your $GBPUSD technical analysis from @JStanleyFX here: https://t.co/n6vYfe6Gfh https://t.co/zQq74Zzxsv
  • The bull flag pattern is a great pattern to add to a forex trader’s technical arsenal. Explosive moves are often associated with the bull flag. Learn more about the bull flag pattern here: https://t.co/ZNRBvNELeJ https://t.co/CKkWNMLkuw
  • The US Dollar could rise if key ISM, PMI and nonfarm payrolls data causes recession fears to swell and rekindles appetite for the haven-linked Greenback. Get your $USD market update from @ZabelinDimitri here: https://t.co/iTlnxWuSqn https://t.co/brEsDw2a5K
New Zealand Dollar Rally Threatened By Slowing Employment

New Zealand Dollar Rally Threatened By Slowing Employment

2011-07-29 22:30:00
David Song, Strategist
Share:

The New Zealand Dollar NZ$

NZD/USD NY Spot Close 0.87885

New_Zealand_Dollar_Rally_Threatened_By_Slowing_Employment_body_nzdusd_risk.png, New Zealand Dollar Rally Threatened By Slowing Employment

New Zealand Dollar Rally Threatened By Slowing Employment

Fundamental Forecast for New Zealand Dollar: Bullish

The New Zealand Dollar extended the advance from earlier this month to reach a fresh record-high of 0.8794, and the high-yielding currency may continue to gain ground in August as the central bank plans to bring the benchmark interest rate back to 3.00 percent. After holding the cash rate steady for the third meeting, the Reserve Bank of New Zealand saw ‘little need for the March ‘insurance’ cut to remain in place much longer,’ and the central bank looks as though it will normalize monetary policy later this year as the recovery gather pace.

At the same time, RBNZ Governor Alan Bollard talked down speculation for a cash rate beyond 3.00 percent, stating that underlying inflation is expected to stay well within the 1-3 percent target range, and went onto say that the marked appreciation in the exchange rate reduces the need for additional rate hikes as it drags on the real economy. In light of the recent comments, it seems as though the central bank will revert back to a wait-and-see approach after unwinding the 50bp rate cut from earlier this year, and Mr. Bollard may adopt a neutral policy stance heading into 2012 as the expansion in global trade appears to be slowing. Despite the balanced tone held by the central bank head, market participants still see the cash rate increasing by more than 100bp over the next 12-months according to Credit Suisse overnight index swaps, and expectations for higher borrowing costs should help to prop up the high-yielding currency in the week ahead as investors weigh the prospects for future policy.

Although the NZD/USD remains heavily overbought, we may see the exchange rate continue to push higher as the relative strength index holds above 70, but the labor report scheduled for the following week could spark a near-term correction in the exchange rate should it dampen the outlook for future growth. Indeed, employment is expected to hold flat in the second-quarter after expanding 1.4% during the first-three months of 2011, while the participation rate is projected to fall back to 68.4% from 68.7% during the same period. As labor growth cools, the data could foreshadow a slowdown in private sector consumption, and the RBNZ may scale back its optimism towards the economy should the data come out worse than expected. - DS

DailyFX provides forex news and technical analysis on the trends that influence the global currency markets.

DISCLOSURES

News & Analysis at your fingertips.