With not a lot of major economic reports on tap, I’m looking at NZD/CAD’s chart to trade OPEC-related headlines.
Can NZD/CAD extend its month-long downtrend?
Before moving on, ICYMI, today’s Daily Asia-London Session Watchlist looked at EUR/JPY’s recent bounce as an opportunity to ride a more obvious trend. Be sure to check that out to see if there is still a potential play!
And now for the headlines that rocked the markets in the last trading sessions:
Fresh Market Headlines & Economic Data:
- Fed’s Waller: Fed won’t keep interest rates low so Washington can cheaply finance record debt
- New Zealand building approvals plummet in February
- Japanese retail sales fell for third straight month amid lacklustre consumer spending
- Asia shares higher as investors overlook U.S. hedge fund default
- German import prices rise for first time since 2019
- After firing Turkey’s central bank chief, Erdogan also removes deputy
- Oil gains as focus switches to OPEC+ extending output cuts
Upcoming Potential Catalysts on the Economic Calendar:
- FOMC member Randal Quarles to participate in a virtual panel discussion at 1:00 pm GMT
- U.S. house price index at 1:00 pm GMT
- U.S. CB consumer confidence at 2:00 pm GMT
- FOMC member John Williams to moderate a small business discussion at 6:30 pm GMT
What to Watch: NZD/CAD
If you haven’t looked at NZD/CAD’s chart lately, then you should know that the New Zealand dollar has been losing its shine against the Loonie as the latter receives support from rising crude oil prices (Canada’s biggest export).Meanwhile, the Kiwi has been losing momentum since New Zealand’s data releases started getting real and hinted that economic recovery is still limited if the country can’t get momentum from its biggest trading partners.
It also doesn’t help that the Reserve Bank of New Zealand (RBNZ) recently introduced new housing policies that would limit rising housing prices and reduce the pressure on the central bank to tighten its easy monetary policies.
Unless we see fresh catalysts, then NZD/CAD’s trend will likely continue. Eyes are now on OPEC and its friends, who are largely expected to extend their oil production cuts through June.
Bears can start shorting at current levels and place stops just above the trend line and 200 SMA resistance. March’s lows look like good profit targets but you can also aim for new 2021 lows if you’re feeling trend-friendly.