Nzdusd - page 14
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NZD/USD Forecast Mar. 23-27
The New Zealand dollar enjoyed a positive week, riding on the weakness of the US dollar among other things. The main event awaiting us now is the release of the trade balance. Here is an analysis of fundamentals and an updated technical analysis for NZD/USD.
The economy in New Zealand grew by 0.8% in Q4 2014, exactly as expected. This showed the economy has a good footing and more than balanced the fall in milk prices (8.8%) after a long winning streak. In the US, the Fed sounded a more dovish tone, and the greenback fell.
* All times are GMT.
New Zealand data - Q1 consumer confidence: 117.4 (prior 114.8)
Q1 Westpac McDermot Miller Consumer Confidence from New Zealand: 117.4
Westpac says the strong lift in confidence is not surprising given the fall in petrol prices, steady mortgage rates, share and house price gains
There's not a lot of movement in the NZD/USD, but up a few tics:
The NZDUSD tried to break above the 0.7600 level, but that level has proven to be a good resistance for the pair. A long upper shadow can be seen on the daily candle, indicating bearish pressure.
Sliding Dairy Prices see NZ Trade Surplus Miss F'Casts in Feb
New Zealand's dairy sector continued to be the driving force behind changes in the overseas trade balance last month, with sharp falls in global dairy prices still haunting exporters.
The merchandise trade surplus expanded to $50 million in February from a downwardly-revised $33 million in January, Statistics New Zealand said on Wednesday. Market analysts expected the trade surplus to expand to $350 million last month.
Exports tumbled 13.4% year-on-year in February to $3.92 billion, however they were up 6.7% over the month. Milk powder, butter, and cheese exports plummeted 41% between February 2014 and last month due to lower dairy prices and a 10% drop in volumes.
Global dairy prices fell roughly 50% from a peak in February 2014 to December due to greater supply and reduced demand from China. This year prices have come back up around 20% due to drought conditions in parts of New Zealand, which have limited supply.
New Zealand-made goods destined for China continued to fall sharply in February, sliding 36% year-on-year, driven by whole-milk powder. Exports to Australia fell 8.1% over the same period, while exports to the US climbed 26%, led by frozen beef.
Imports grew 3.7% year-on-year in February to $3.87 billion, and shot up 6.3% compared with January. This was largely driven by a 14% rise in imported consumption goods since February last year. In addition, machinery and plant equipment - under the capital goods category of imports - were up a solid 13% last month. Intermediate goods imports fell 2.5% in February due to crude oil which plunged 42% year-on-year, mainly on the back of lower global oil prices.
In the year-ended February 2015 New Zealand's trade deficit was $2.2 billion, a large turnaround from the $627 million surplus recorded in February 2014.
source
Another visit to the 0.7500 level is possible on the NZDUSD, very close to that level we can see the 200 perido EMA on the 4 hour chart, which could help support the price there.
NZD/USD: Pair Dives to $0.74, Resumes Bearish Trend
The kiwi dropped on Wednesday as the pair failed to hold the bullish trendline at $0.7440 and dipped below, with stops hit on the way. The dollar quickly strengthened to $0.74, where some stabilization was observed during midday trading. The next target lies at $0.7370, followed by $0.7280.
Commodity-backed currencies like the aussie and kiwi made some false breakouts from their longer-term bearish trends last week, switching the short-term trend to neutral, but quickly returned to the declining regime after bears regained control.
The New Zealand dollar was undermined further by weakening grains, mainly corn, which dropped the most since 2013 amid the highest inventories in 28 years.
Traders will watch the dairy auction, scheduled later in the session, which might send the pair further lower.
Later in the session the ADP employment report is due, with 225,000 job gains forecast, above last month's 212,000 print. The labor market is being closely monitored as the Federal Reserve should be on a track to raise rates if the current momentum prevails. To that end, Friday's non-farm payrolls will be closely followed.
Moreover, the US ISM Manufacturing report is on the agenda and should tick lower to 52.5 from 52.9.
The closely-watched US consumer confidence spiked to 101.3 points in March, Tuesday's report revealed, beating the estimate of 96.6, and advancing from 96.4 previously. Consumer confidence is strong, despite spending lagging in the previous months, meaning consumers are saving and not spending, which should boost deflationary pressures.
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Good pullback on the NZDUSD to the 0.7500 level, but the zone has proven to be a good resistance so far. Possible bounce to the downside from there.
NZD/USD forecast for the week of April 6, 2015
The NZD/USD pair broke down during the course of the week, slicing through the 0.75 handle. However, we found enough support just below to turn things back around and form a nice-looking hammer. The hammer of course suggests that we are going to go higher but you have to keep in mind that the previous week formed a shooting star. With that, it means that the market will more than likely continue to go sideways, and as a result as long-term traders we have no interest in the New Zealand dollar.
The NZDUSD has found a good resistance at the 0.7600 level. possible bounce to the downside.
NZD/USD: Kiwi Strongly Higher as Traders Wait for FOMC Minutes
The New Zealand dollar was up over 1% against the US dollar on Wednesday, neglecting speech from the President of the New York Fed William Dudley about a possible rate hike in June as traders choose to wait for more details from the latest FOMC meeting to position trades.
The kiwi surged 1.07% to $0.7568, lifting off the overnight weekly low of $0.7480, with the next target likely residing at $0.76.
"I could imagine circumstances where a June rate hike is still in play. If the next jobs report is strong...if second-quarter GDP look like it is bouncing quite sharply," Dudley said in an interview with Reuters. sh to support an extension of recent market moves," Gennadiy Goldberg from TD Securities said in a note on Wednesday.
In a speech on Monday, the President of the New York Fed William Dudley stressed that the decision to start raising rates will depend on incoming economic data and the precise timing was thus uncertain.
The latest non-farm payrolls showed a major disappointment, when the figure rose 126,000 in March, nearly halving the expectations.
"Since that meeting we’ve heard a lot from Fed officials about their thoughts vis-a-vis the timing of a rate hike, but that was before last Friday’s payrolls number. There is the likelihood given some of the comments in the last couple of days from the Atlanta Fed’s Dennis Lockhart, and the New York Fed’s Bill Dudley, that policymakers are likely to tread slightly more carefully in the coming days and weeks and that in that context, the contents of tonight’s minutes are likely to be stale, and out of date," Michael Hewson from CMC Markets wrote in a research note on Wednesday.
The Fed will publish the minutes from its March meeting in a couple of hours, with traders hoping to catch a glimpse into the last Fed meeting, which was interpreted as being very dovish by market participants.
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