Connect with us

Forex

NZDUSD Forms a Wedge, NZDJPY Rests on Support

Published

on


Technical Forecast for the New Zealand Dollar: Bearish

  • A critically important fundamental event on Tuesday could shift larger trends and break through important price levels
  • NZDUSD currently trades in a wedge but is running out of space fast
  • NZDCAD faces support after a hearty move lower on Friday

The New Zealand Dollar traded lower last week across the board after disappointing unemployment data. The fundamental development could shift the landscape if it is accompanied by similar statements from the New Zealand central bank next week. With that in mind, a fundamental catalyst could serve to shake up the technical landscape and create some bigger-picture breaks.

NZD/USD Price Chart: 4-Hour Timeframe (June 2018 to February 2019) (Chart 1)

NZDUSD Price chart technical analysis

NZDUSD traded lower last week and plunged through multiple highlighted support levels. The pair has now etched out a wedge with the lower side originating at the 2018 lows around 0.6423. The upper bound dates back to mid-May 2018 around 0.7055, a level the pair was unable to pass through on multiple tests. The higher-side has since been tested in early December and again in early February. Within the wedge rests other support levels for shorter-term traders.

See our first quarter forecasts for NZD, USD, EUR and other currencies with the DailyFX Trading Guides.

One such support level rests around the 0.6700 range but commands less respect in the overall picture. Similarly, the 23.6% Fib level at 0.6688 should provide some support in the near term. While these price points are notable, the most important technical levels in the week ahead are the lower and upper lines of the wedge.

NZDJPY Technical Outlook

NZDJPY received the most votes on my Twitter poll this week and knocked NZDCAD off the stage for the time being. That said, I still provide consistent commentary and technical levels for multiple pairs on Twitter throughout the week. Follow me on Twitter @PeterHanksFXto participate in future polls and influence what pairs I cover in the weekly article here.

As for NZDJPY, the pair will be subjected to significant fundamental event risk in the week ahead. Thus, the technical levels to watch will be longer-term as volatility should be higher than normal.

NZDJPY had solidified considerable gains in the weeks immediately following the USDJPY flash crash that saw risk-on pairs like AUD and NZD experience similar price movement. After the unemployment data however, the pair now rests slightly above a support trendline from early January.

Since the rebound began, the line has not been broken and it will be the first line of defense against a move lower. Should it be broken, the 23.6% Fib level from July 2017’s high to the flash crash’s recent low will step in. Finally, expect some support in the 72.34 area if both of the other levels are broken.

NZD/JPY Price Chart: Daily Timeframe (July 2017 – February 2019) (Chart 2)

NZDJPY price chart technical analysis

To the topside, 38.2% Fib resistance around 74.80 could give the pair pause on a smaller climb upward but would likely be blown through rather quickly on news of a large fundamental development. Similarly, the recent swing high around 75.89 should receive the same treatment. A resistance level that should command considerable respect is the trendline from January 2015 but it lies considerably higher than the current trading price.

Check out the other weekly technical forecasts:

US Dollar

Australian Dollar

Crude Oil

–Written by Peter Hanks, Junior Analyst for DailyFX.com

Contact and follow Peter on Twitter @PeterHanksFX

DailyFX forecasts on a variety of currencies such as the Pound or the Euro are available from the DailyFX Trading Guides page. If you’re looking to improve your trading approach, check out Traits of Successful Traders. And if you’re looking for an introductory primer to the Forex market, check out our New to FX Guide.



Source link

Continue Reading
Click to comment

Leave a Reply

Your email address will not be published. Required fields are marked *

Forex

Traders Net-Short Are 63.3% Higher from Last Week

Published

on

By


US500,SP500

TRADERS REMAIN NET-SHORT

US 500: Retail trader data shows 24.6% of traders are net-long with the ratio of traders short to long at 3.07 to 1. In fact, traders have remained net-short since Jan 07 when US 500 traded near 2473.53; price has moved 11.9% higher since then. The number of traders net-long is 1.7% higher than yesterday and 1.6% lower from last week, while the number of traders net-short is 5.2% higher than yesterday and 63.3% higher from last week.

For more in-depth analysis, check out the Q1 2019 Forecast for Equities

S&P 500 SUGGESTS STRONG BULLISH BIAS

We typically take a contrarian view to crowd sentiment, and the fact traders are net-short suggests US 500 prices may continue to rise. Traders are further net-short than yesterday and last week, and the combination of current sentiment and recent changes gives us a stronger US 500-bullish contrarian trading bias.

— Written by Nancy Pakbaz, CFA, DailyFX Research

Follow Nancy on Twitter @NancyPakbazFX



Source link

Continue Reading

Forex

On to the Next Big Levels of Resistance

Published

on

By


S&P 500/Dow Jones/Nasdaq 100 Technical Highlights:

  • S&P 500 nearing 2800-area, several swing-highs from last year
  • Dow Jones 26k-ish stands between it and record highs
  • Nasdaq 100 trading around resistance already

Check out the forecasts for Global Stock Indices and other markets on the Trading Guides page.

S&P 500 nearing 2800-area, several swing-highs from last year

The S&P 500 is continuing to show impressive strength since its v-bottom began the day after Christmas, with it having a few points along the way where it could have been stopped in its tracks. But it wasn’t, and this has levels prior to the December swoon in view. The area surrounding 2800 is a big one.

From 2800 up to 2817 there were three peaks created from failed rallies, a logical area, with the rally having come this far, to look for stocks to weaken from. Watching price action will be key, as always, but especially around the levels just ahead.

While resistance looks likely to get tested soon, the upward channel structure over the past month will keep stocks pointed higher for as long as it holds. If the S&P is rejected off resistance, to further bolster the notion of a sizable retracement we’ll need to see the underside parallel undermined.

For now, the top-side must be respected, but the time for material weakness may be nearing…

Stocks are rallying, but will it last in the long-term? Find out where our analysts see stocks headed in the Global Equities Forecast.

S&P 500 Daily Chart (2800/817 big spot)

S&P 500 daily chart, 2800/817 big spot

Dow Jones 26k-ish stands between it and record highs

The Dow is nearing the 26k-area, a spot which is basically the equivalent of what 2800 is to the S&P 500. The zone runs up to near 26300. The focus is primarily on the S&P right now as it is the broader index, but depending on how price action plays out, the Dow may be the better index to short at some point if it shows relative weakness to the broader market.

Dow Daily Chart (26k-ish stands in the way)

Dow daily chart, 26k-ish stands in the way

Nasdaq 100 trading around resistance already

The Nasdaq 100 continues to lag behind, which is something to continue monitor given it was the bull-market leader with its leading group of stocks – FAANG – dominating price action and sentiment. The NDX is trading around the 200-day and near late-year swing highs equivalent to the ones discussed with regard to the S&P 500 and Dow. So far, relative weakness is making the 100 the preferred fade if the S&P finds material selling off resistance surrounding 2800/17.

Nasdaq 100 Daily Chart (trading around resistance)

Nasdaq 100 daily chart, trading around resistance

To learn more about U.S. indices, check out “The Difference between Dow, Nasdaq, and S&P 500: Major Facts & Opportunities.” You can join me every Wednesday at 10 GMT for live analysis on equity indices and commodities, and for the remaining roster of live events, check out the webinar calendar.

Tools for Forex & CFD Traders

Whether you are a beginning or experienced trader, DailyFX has several resources available to help you; indicator for tracking trader sentiment, quarterly trading forecasts, analytical and educational webinars held daily, trading guides to help you improve trading performance, and one specifically for those who are new to forex.

—Written by Paul Robinson, Market Analyst

You can follow Paul on Twitter at @PaulRobinsonFX



Source link

Continue Reading

Forex

Aussie Dollar Falls on RBA Minutes, US-China Trade Talks Eyed

Published

on

By


TALKING POINTS – AUSSIE DOLLAR, RBA MINUTES, ZEW, TRADE WARS, CHINA

  • Aussie Dollar, commodity bloc FX down on downbeat RBA meeting minutes
  • Germany’s ZEW survey may compound worries about slowing global growth
  • Trade wars in focus on US-China negotiations, fears of US auto tariff hike

The sentiment-linked Australian, Canadian and New Zealand Dollars weakened in otherwise quiet Asia Pacific trade. The move appeared to be inspired by an ominous tone in minutes from February’s RBA policy meeting. Meanwhile, the US Dollar corrected gently higher.

RBA officials cited “significant uncertainties”, noting that trade tensions and cooling domestic demand have increased negative knock-on risks from China. They added that consumption may fall if domestic house prices fall much further. They suffered the worst drop since 1983 in the three months through January.

TRADE WAR DEVELOPMENTS, GERMAN ZEW DATA MENACE MARKETS

Looking ahead, Germany’s ZEW survey of analyst sentiment may compound the downbeat mood, especially if it echoes the disappointing trend in regional data outcomes since September. A small improvement in the forward-looking Expectations index is nevertheless expected to keep it within a hair of six-year lows.

The tone of US-China trade negotiations may also be formative as a delegation from Beijing arrives in the US for continued talks. Both sides painted a rosy picture earlier in the week, but the Trump administration may be preparing a spoiler as the President ponders raising auto import tariffs.

What are we trading? See the DailyFX team’s top trade ideas for 2019 and find out!

ASIA PACIFIC TRADING SESSION

Asia Pacific Trade Economic Calendar

EUROPEAN TRADING SESSION

Europe Trade Economic Calendar

** All times listed in GMT. See the full economic calendar here.

FX TRADING RESOURCES

— Written by Ilya Spivak, Currency Strategist for DailyFX.com

To contact Ilya, use the comments section below or @IlyaSpivak on Twitter



Source link

Continue Reading

Trending

Copyright © 2017 Zox News Theme. Theme by MVP Themes, powered by WordPress.