Not a lot going on in New Zealand’s calendar this week, which means Kiwi traders will likely look to countercurrency price action for cues.
Which potential catalysts should you be paying attention to?
I have a few ideas:
- Traders look at business surveys and reports because the Reserve Bank of New Zealand (RBNZ) considers these reports in its policy decisions
- The volume of manufacturing sales (Dec 8, 9:45 pm GMT) could improve from -12.1% to -6.0% in Q3 2020
- BusinessNZ manufacturing index (Dec 10, 9:30 pm GMT) last printed at 51.7, down from 54.0 in September
Market risk sentiment
- After rising strongly in the last couple of weeks, NZD’s momentum across the board seems to be fading and could be vulnerable to some profit-taking
- Closely watched economic releases from other major economies like China’s trade balance and BOC and ECB’s policy decisions can affect major NZD pairs
- Broad market themes like vaccine updates, Brexit negotiations, and the U.S. elections can influence the demand for high-yielding bets like the Kiwi
- Stochastic considers the Kiwi “overbought” against the dollar and the yen
- NZD may soon hit “oversold” levels against CHF, EUR, and CAD<
- EMAs are showing Kiwi’s short-term bearish demand on the daily time frame
- Watch out for retracement or reversal opportunities on AUD/NZD, NZD/CHF, EUR/NZD, and NZD/CAD
- NZD saw the most volatility against GBP, CAD, USD, and JPY in the last seven days