I’m watching this textbook correction play on NZD/CHF just before New Zealand prints its quarterly jobs report.
Will the pair resume its slide?
Before moving on, ICYMI, today’s Daily Asia-London Session Watchlist looked at AUD/CHF’s correction setup ahead of the RBA decision. 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 head Powell: U.S. outlook has ‘considerably brightened’
- RBA kept rates unchanged at 0.10% as expected
- RBA to reevaluate April 2024 bond targets in next policy decision
- Australian trade surplus narrowed from 7.60B AUD to 5.57B AUD
- Asian shares edge higher on pandemic recovery hopes
- ETH hits new record high at $3,457
Upcoming Potential Catalysts on the Economic Calendar:
- U.K. mortgage approvals and net lending to individuals at 9:30 am GMT
- Canadian building permits and trade balance at 1:30 pm GMT
- U.S. trade balance at 1:30 pm GMT
- U.S. factory orders at 3:00 pm GMT
- RBNZ Financial Stability Report at 10:00 pm GMT
- New Zealand quarterly employment change at 11:45 pm GMT
- New Zealand GDT auction coming up
What to Watch: NZD/CHF
I’m looking at another textbook break-and-retest setup on the short-term chart of NZD/CHF, and the upcoming jobs data from New Zealand might be a strong catalyst.Market expectations are for a weaker increase in hiring at 0.3% versus the earlier 0.6% gain, which might keep the jobless rate unchanged at 4.9%. Wage growth is also expected to have slowed from 0.5% to 0.3% for the first quarter of the year.
Weaker than expected results might weigh on the Kiwi, as this could put the RBNZ farther from tightening monetary policy.
If that’s the case, NZD/CHF could hit a ceiling around the 38.2% to 50% Fibonacci retracement levels. These span an area of interest or former support zone that could hold as resistance around the .6575 mark.
This also happens to be right around the dynamic resistance at the moving averages, and the 100 SMA being below the 200 SMA confirms that resistance levels are likely to hold.
At the same time, Stochastic is starting to turn lower from the overbought zone. If downbeat jobs data draw Kiwi sellers out, NZD/CHF could find its way back to the swing low or lower!