Risk-taking was the name of the game during the Asian session, as traders focused on economies slowly re-opening and commodities rallying.
But will today’s events change the tides for the comdolls?
Before we get to NZD/USD’s setup, here are the major headlines in the last couple of hours:
Fresh Market Headlines & Economic Data:
- Japan’s markets out on Showa Day holiday
- Kiwifruit gives NZ’s March exports a golden glow
- UK retailers cut non-food prices by most on record – BRC
- Australia’s first-quarter inflation hits 5-1/2-year high, prices to plunge in second quarter
- Coronavirus likely hammered U.S. economy in first quarter
- Asia shares extend gains as economies slowly re-open, oil rallies
Upcoming Potential Catalysts on the Economic Calendar:
- Germany’s import prices at 6:00 am GMT
- Germany’s preliminary CPI on tap
- Credit Suisse economic expectations at 8:00 am GMT
- Germany, U.K., and Italy’s bond auctions scheduled today
What to Watch: NZD/USD
Upside surprises in New Zealand’s trade data and Australia’s CPI numbers helped traders shrug off talks of negative interest rates for the RBNZ.
If Uncle Sam’s GDP disappoints, then we could see risk aversion that would drag NZD/USD from its range resistance down to its .5950 support.
If the Fed’s forward guidance and outlook result in further dollar weakness, however, then NZD/USD can break above the big .6000 and aim for areas of interest closer to .6150.
Aside from all those catalysts, make sure you pay attention to any end-of-quarter flows, which would come from profit-taking ahead of the months’ end.