NZD in the doldrums

Arnaud Masset Swissquote Bank Ltd

Expect further downside in NZD/USD, as the interest rate differential continues to move negatively, making NZD shorts costly. Speculators are still net long Kiwi (non-commercial position: net long 40% of total open interest) and will unwind position as the currency nosedives. The next key support can be found at 0.7188 (low from 29 March), then 0.7154 (low from 21 March). On the upside, resistance lies around 0.74 (high from mid-April). All in all, a return towards 0.70, or even below, seems reasonable.

Stay on top of the markets with Swissquote’s News & Analysis

The New Zealand dollar saw heavy selling on Friday amidst weak inflation data. The Kiwi fell 0.53% against the greenback and hit $0.7230. Headline inflation eased to 1.1% annually in Q1, down from 1.6% in the previous quarter. After increasing 0.5% in the Q4 last year, tradable inflation contracted 0.40% annually, while non-tradable inflation eased to 2.3%. The relative strength of the Kiwi during that period explains most of the reduction in price pressures. However, the sector factor model, used by the Reserve Bank of New Zealand, shows a brighter picture, holding steady at 1.5%.

Author

Arnaud Masset

Swissquote Bank Ltd

Arnaud Masset is a Market Analyst at Swissquote Bank. He has a strong technical background and also works in the development of quantitative trading strategies.

EUR/USD hits two-day highs near 1.1820

EUR/USD picks up pace and reaches two-day tops around 1.1820 at the end of the week. The pair’s move higher comes on the back of renewed weakness in the US Dollar amid growing talk that the Fed could deliver an interest rate cut as early as March. On the docket, the flash US Consumer Sentiment improves to 57.3 in February.

GBP/USD reclaims 1.3600 and above

GBP/USD reverses two straight days of losses, surpassing the key 1.3600 yardstick on Friday. Cable’s rebound comes as the Greenback slips away from two-week highs in response to some profit-taking mood and speculation of Fed rate cuts. In addition, hawkish comments from the BoE’s Pill are also collaborating with the quid’s improvement.

Gold climbs further, focus is back to 45,000

Gold regains upside traction and surpasses the $4,900 mark per troy ounce at the end of the week, shifting its attention to the critical $5,000 region. The move reflects a shift in risk sentiment, driving flows back towards traditional safe haven assets and supporting the yellow metal.

Crypto Today: Bitcoin, Ethereum, XRP rebound amid risk-off, $2.6 billion liquidation wave

Bitcoin edges up above $65,000 at the time of writing on Friday, as dust from the recent macro-triggered sell-off settles. The leading altcoin, Ethereum, hovers above $1,900, but resistance at $2,000 caps the upside. Meanwhile, Ripple has recorded the largest intraday jump among the three assets, up over 10% to $1.35.

Three scenarios for Japanese Yen ahead of snap election

The latest polls point to a dominant win for the ruling bloc at the upcoming Japanese snap election. The larger Sanae Takaichi’s mandate, the more investors fear faster implementation of tax cuts and spending plans.

XRP rally extends as modest ETF inflows support recovery

Ripple is accelerating its recovery, trading above $1.36 at the time of writing on Friday, as investors adjust their positions following a turbulent week in the broader crypto market. The remittance token is up over 21% from its intraday low of $1.12.