The Kiwi could be on the move this week with the latest RBNZ decision just a few days ahead. Here are a few multi-time frame setups among the crosses to check out!
The Reserve Bank of New Zealand will give its latest monetary policy decision this week (Sept 25, 3:00 am GMT), and expectations are to keep interest rates at 1.00% as it’s likely they want to see the effects of the most recent rate cuts. It could still be a market mover, especially if there are any changes to the monetary policy statement, and if you’re leaning short-term bearish on the Kiwi, then this is one of the best looking short-term setups among Kiwi pairs.
On the hourly chart of NZD/CAD, we can see the pair bouncing higher on today’s session after a strong move lower last week from 0.8425 to 0.8300. The pair is now in the Fibonacci retracement area of the recent swing lower, and we’re seeing divergence between price action (higher ‘highs’) versus the stochastic indicator (lower ‘highs’). So, odds are pretty good that technical traders are seeing these patterns and potentially setting up to hop in the downtrend the pair has been in since mid-July.
If you’re a bull on the New Zealand dollar, then this support retest on the four hour chart of NZD/CHF may be right up your alley. The pair has been falling since mid-September after failing to break above the 0.6400 handle, and now traders are retesting the strong support area 0.6200 to 0.6220.
The stochastic indicator is also signaling potential oversold conditions, and given that this pair has a positive interest rate carry, this setup is a very appealing one to both technical traders and fundamental traders who think the recent hit lower is overdone.
For all of you longer-term traders who are bullish on the New Zealand dollar, we’ve got this setup on the daily chart of GBP/NZD, showing a possible reversal back to the downside. Through 2018 and 2019, the 2.0000 area (give or take a few handles) on GBP/NZD was a major swing point back to the downside, and it’s testing that point once again with stochastic signaling potentially overbought conditions.
We can also see a three candlestick reversal pattern called the “evening star” nearly fully formed that could draw in technical traders to starting getting in short and/or lightening up on long positions.