The U.S. is about to print its retail sales data!
Unless we see fresh catalysts, then comdoll pairs like NZD/USD will likely see volatility around the release.
What do you think?
In case you missed it, NZD/USD has rocketed by 100 pips after breaking its consolidation around the .7050 psychological area.
I’m watching the pair today because traders will likely focus on high-yielding bets like the comdolls when the U.S. publishes its March retail sales data.If the numbers come in stronger than what the markets are expecting, then traders will feel more comfortable with buying the dollar because (a) it will highlight the strength of the U.S. economy’s recovery and (b) it could lead to hotter inflation that the Fed won’t be able to ignore and Fed members could end up tightening its policies sooner than expected.
Dollar strength could drag NZD/USD from its consolidation around .7150 all the way to the 38.2% Fib retracement that also lines up with a key support level back in March.
NZD/USD’s average volatility charts from MarketMilk tells me that 50-pip moves are realistic enough on Thursdays:
If the U.S. retail sales report disappoints, or if traders react to the numbers by taking on more risks, then NZD/USD could make its way to .7200 closer to March’s consolidation levels.
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