Forex Updates: EUR/NZD & EUR/GBP

With the weekend around the corner and quite a few shifts in forex sentiment this week, I thought it would be a good time to do an update on my long-term positions in EUR/NZD and EUR/GBP.

Short EUR/NZD

Original Trade Idea: Technical Short on EUR/NZD for Long-term Position

EUR/NZD Daily Forex Chart

EUR/NZD Daily Forex Chart

EUR/NZD has popped higher since I entered at 1.5075, likely due to the broadly weak New Zealand trade and business data this week.  With pretty much all data points coming in weaker-than-previous reads, the argument is back on the table whether we’ll see a rate cut from the RBNZ to stabilize the economy, an idea that counters recent RBNZ rhetoric that their focus will be cooling the local housing market (my fundamental bias for no rate cuts in the near future).

Technically, the pair hasn’t moved far from my entry and the market remains in an area of potential resistance.  We can also see that the market is below the 200MA and still more than 200 pips away from my stop level. So, I will continue to hold for now to see how the continuing Greek drama will play out for the euro, but I’ll be ready to cut this trade quickly to limit my max risk if the euro/Greek story turns positive or if the pair continues strongly higher.

Short EUR/GBP

Original Trade Idea: Support Break on EUR/GBP?

EUR/GBP 4 Hour Forex Chart

EUR/GBP 4 Hour Forex Chart

For a brief moment it looked like there would be follow through on the support break, but thanks to yesterday’s weak U.K. GDP read, the bulls came back to quickly back control. Fortunately for my short position, that move higher wasn’t really much to talk about, and it’s likely the corrective move some forex traders may have been looking for to play both the technical downtrend and the fundamental divergence between the U.K. and the rest of Europe.

To me, this is a small bounce in the downtrend and with the possibility of a Grexit still in the cards, I think that will likely outweigh the weak U.K. GDP read for a little while longer. Still holding onto my position, but will be open to closing the trade if it moves above the Fibonacci retracement area and falling moving averages.

What do you think the next catalyst may be for these pairs? Can Greece make their next payments in June and are euro shorts in trouble? Will the RBNZ cut rates soon? Is the setback in U.K. GDP a short-term hiccup? Please leave your thoughts in the comment section below!