The RBNZ decided to hold with rate cuts last night but it was explicitly said that exchange rate is linked to interest rate decision. Judging from RBNZ comments we can conclude that they are not happy with the current levels in exchange rate and there is a POSSIBILITY for a further cut in December. Although the statement was hawkish just a single sentence which is implying that high exchange rate is unsustainable made me think about possible rate cut in December. As we know NZD is soft commodity currency and if dairy prices stay high so will the NZDUSD. Technically 0.6725-40 is showing a very good confluence with recent sellers. POC also shows 61.8 fib, H3 and 89 EMA which also suggest a possible T-89 ™ pattern. Those who are familiar with my Price Action Trading School know that Pin Bar rejection off 89 EMA (T-89 chart pattern) is very strong. So we have a multiple confluence there. Adding to that there is also an inner trend line which serves as resistance just above POC. Targets for the move are 0.6620 and 0.6595.
The analysis and the article presents Nenad's opinion. Remember, financial trading is highly speculative & may lead to the loss of your funds. Proper risk management is the Holy Grail of trading.
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