News & Analysis at your fingertips.

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.

0

Notifications

Notifications below are based on filters which can be adjusted via Economic and Webinar Calendar pages.

Live Webinar

Live Webinar Events

0

Economic Calendar

Economic Calendar Events

0
Free Trading Guides
EUR/USD
Mixed
Oil - US Crude
Mixed
Wall Street
Mixed
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
Gold
Bearish
GBP/USD
Mixed
USD/JPY
Mixed
More View more
Real Time News
  • We are days away from the US Presidential election and the markets are caught in the vortex. A contested outcome would raise serious volatility for the markets whereas a decisive outcome seems to support bullish $SPX and Dollar views from the market rank. https://www.dailyfx.com/forex/video/daily_news_report/2020/10/31/SP-500-and-Dollar-Forecast-Leads-Global-Markets-with-Elections-Expectations-.html https://t.co/JnJbyu6TRT
  • The future implications of the #Elections2020 may influence $AUDUSD following the #RBA and #Fed rate decisions as Congress struggles to pass another round of fiscal stimulus. Get your #currencies update from @DavidJSong here: https://t.co/soPu0Wefz2 https://t.co/UWsERr2AYh
  • Gold prices declined in the aftermath of bearish technical cues, but a key zone of support was reinforced. $XAUUSD volatility risk is elevated ahead of the #Elections2020. Get your #metals update from @ddubrovskyFX here: https://t.co/gWOxdqk8OL https://t.co/gBMgF0YNjH
  • USD awakens, placing GBP/USD on the backfoot, while EUR/GBP cracks 0.90. Get your #currencies update from @JMcQueenFX here: https://t.co/fndMQJLul8 https://t.co/elz5gNAKrB
  • What are some factors impacting Euro’s forecast this quarter? Get your free forecast here: https://t.co/kpBYVz31Bd https://t.co/7EzMPg9Kqg
  • Emotions are often a key driving force behind #FOMO. If left unchecked, they can lead traders to neglect trading plans and exceed comfortable levels of risk. Read on and get your emotions in check here:https://t.co/eILWbFgHRE https://t.co/DjMdgL5x19
  • Technical indicators are chart analysis tools that can help traders better understand and act on price movement. Learn more about the importance of technical analysis here: https://t.co/NpC1D8y4Aa https://t.co/6sqqRfTri2
  • The British Pound, Australian Dollar and US Dollar may all experienced heightened periods of volatility as geopolitical risks in North America, Asia and Europe rattle global financial markets. Get your $GBPUSD market update from @ZabelinDimitri here:https://t.co/0EFToM5Y8I https://t.co/5gsZQfX6aG
  • The New Zealand Dollar may continue to outperform the haven-associated US Dollar as price breaks above key long-term resistance. Get your $NZDUSD market update from @DanielGMoss here:https://t.co/D1DxtDkJXd https://t.co/DwkK9F9FCJ
  • #Gold prices declined following bearish technical cues, but a key zone of support was reinforced over the past 48 hours. #XAUUSD volatility risk is elevated ahead of the #USElection - https://www.dailyfx.com/forex/technical/article/fx_technical_weekly/2020/10/30/Gold-Technical-Forecast-Election-Raises-Volatility-Risk-But-Support-Holds.html?CHID=9&QPID=917702&utm_source=Twitter&utm_medium=Dubrovsky&utm_campaign=twr https://t.co/5hgGEojvIE
NZD/USD Remains Under Pressure Ahead of New Zealand Budget Statement

NZD/USD Remains Under Pressure Ahead of New Zealand Budget Statement

2018-05-14 19:30:00
David Song, Strategist
Share:

NEW ZEALAND DOLLAR TALKING POINTS

NZD/USD struggles to hold its ground as market participants digest the fresh developments coming out of the New Zealand economy, and the exchange rate appears to be on track to test the November-low (0.6780) as the bearish momentum appears to be gathering pace.With the Reserve Bank of New Zealand (RBNZ) interest rate decision out of the way, attention now turning to the annual budget statement as Finance Minister Grant Robertson is scheduled to deliver the updates on May 17.

Image of daily change for major currencies

FINANCE MINISTER GRANT ROBERTSON TO DELIVER ANNUAL BUDGET STATEMENT

Image of daily change for NZDUSD

The administration under Prime Minister Jacinda Ardern is likely to reiterate its plan to further develop the Living Standards Framework (LSF) as officials focus on the promoting the wellbeing and living standard for households. The fiscal strategy is likely to reiterate that the economic outlook remains ‘supported by household income growth, continued population growth, low interest rates and a terms of trade at record levels,’ along with the Budget Responsibility Rules which are to:

  • Deliver a sustainable operating surplus across an economic cycle.
  • Reduce the level of net core Crown debt to 20 per cent of GDP within five years of taking office.
  • Prioritise investments to address the long-term financial and sustainability challenges facing New Zealand.
  • Take a prudent approach to ensure expenditure is phased, controlled and directed to maximise its benefits. The Government will maintain its expenditure to within the recent historical range of spending to GDP ratio.
  • Ensure a progressive taxation system that is fair, balanced and promotes the long-term sustainability and productivity of the economy.

With that said, more of the same from Mr. Robertson may do little to alter the near-term outlook for NZD/USD as the RBNZ remains in no rush to lift the cash rate off of the record-low, and recent price action raises the risk for a further decline in the exchange rate as bearish momentum from earlier this year appears to be reasserting itself.

NZD/USD RISKS FURTHER LOSSES AS RELATIVE STRENGHT INDEX (RSI) DIPS BACK INTO OVERSOLD TERRITORY

The New Zealand dollar may continue to weaken against its U.S. counterpart as RBNZ Governor Adrian Orr largely endorses a wait-and-see approach for monetary policy, and the NZD/USD rate may face fresh 2018 lows as the Relative Strength Index (RSI) dips back into oversold territory. The development suggests the bearish momentum is gathering pace as the oscillator extends the downward trend from earlier this year, with kiwi-dollar at risk of making a run at the November-low (0.6780) as long as the momentum indicator holds below 30.

NZD/USD DAILY CHART

Image of NZDUSD daily chart
  • A close below the 0.6950 (61.8% expansion) to 0.6960 (38.2% retracement) region opens up the Fibonacci overlap around 0.6820 (23.6% retracement) to 0.6870 (78.6% expansion).
  • Next area of interest comes in around 0.6780 (100% expansion), which lines up with the November-low, followed by the 0.6710 (61.8% expansion) region.

Interested in having a broader discussion on current market themes? Sign up and join DailyFX Currency Analyst David Song LIVE for an opportunity to discuss potential trade setups!

Image of DailyFX economic calendar

Additional Trading Resources

Are you looking to improve your trading approach? Review the ‘Traits of a Successful Trader’ series on how to effectively use leverage along with other best practices that any trader can follow.

Want to know what other currency pairs the DailyFX team is watching? Download and review the Top Trading Opportunities for 2018.

--- Written by David Song, Currency Analyst

Follow me on Twitter at @DavidJSong.

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

DISCLOSURES