NZDUSD – New Zealand Dollar Struggle To Continue Vs USD
Aayush Jindal
Key Highlights
The New Zealand dollar declined heavily this week against the US Dollar, and moved below 0.7150.
The NZDUSD pair broke a major bullish trend line and support at 0.7140 on the 4-hours chart to open the gates for more downsides.
The US Manufacturing Purchasing Managers Index (PMI) for Feb 2017 released by the Markit Economics recently posted a decline from 54.3 to 54.2.
Later today, the US Initial Jobless Claims will be released by the US Department of Labor, which is forecasted to decline from 244K to 243K.
NZDUSD Technical Analysis
The New Zealand dollar was under a lot of bearish pressure recently, as it moved below the 0.7180 support against the US Dollar. The NZDUSD pair is now at a risk of more declines towards 0.7100.Before the recent downside move, the pair cleared the 100 simple moving average at 0.7200 on the 4-hours chart. Also, there was a break below a critical bullish trend line and support at 0.7140. The pair fell towards 0.7100, and currently attempting a recovery.However, any major upside in NZDUSD is unlikely considering the bearish pressure. It may face many resistances on the way up like 0.7150, 0.7170 and 0.7180. Overall, there are chances of further declines below 0.7100 in the short term.
US Manufacturing PMI
Recently in the US, the Manufacturing Purchasing Managers Index (PMI) for Feb 2017 was released by the Markit Economics. The market was expecting a minor rise from the last reading of 54.3 to 54.4.However, the result was on the lower side, as the US Manufacturing PMI decreased from 54.3 to 54.2. Commenting on the report, the Chief Business Economist at IHS Markit, Chris Williamson, stated:
The February survey points to a modest cooling in the rate of expansion of the manufacturing sector, but it remains too early to tell if this is the start of a more prolonged slowdown.
Overall, the result was not encouraging, which might weigh on the greenback in the short term.
Other Economic Releases for Upcoming Sessions
Swiss Gross Domestic Product for Q4 2016 (QoQ) – Forecast +0.4%, versus 0% previous.
Spain’s Gross Domestic Product for Q4 2016 (QoQ) – Forecast +0.7%, versus 0.7% previous.
UK’s Construction PMI for Feb 2017 – Forecast 52.4, versus 52.2 previous.
Euro Zone CPI for Feb 2017 (YoY), Preliminary - Forecast +2%, versus 1.8% previous.
US Initial Jobless Claims - Forecast 243K, versus 244K previous.
Canadian Gross Domestic Product for Q4 2016 (Annualized) – Forecast +2.1%, versus 3.5% previous.
Before the recent downside move, the pair cleared the 100 simple moving average at 0.7200 on the 4-hours chart. Also, there was a break below a critical bullish trend line and support at 0.7140. The pair fell towards 0.7100, and currently attempting a recovery.However, any major upside in NZDUSD is unlikely considering the bearish pressure. It may face many resistances on the way up like 0.7150, 0.7170 and 0.7180. Overall, there are chances of further declines below 0.7100 in the short term.
However, the result was on the lower side, as the US Manufacturing PMI decreased from 54.3 to 54.2. Commenting on the report, the Chief Business Economist at IHS Markit, Chris Williamson, stated: