NZD/USD Review: bounce into 0.6750 on RBNZ inflation call
- Kiwi bumps higher on softly-rising RBNZ inflation expectations.
- China trade figures show tariffs beginning to weigh on Asia trade; fears of knock-on effects could limit upside moves.
The NZD/USD is knocking above 0.6750 after the Reserve Bank of New Zealand (RBNZ) pushed their inflation expectations ever-so-slightly higher than the previous quarter.
The RBNZ has set their Quarterly Inflation Expectations for 2018's Q3 at 2.04%, a hair higher than Q2's 2.01%. The move isn't much to go on, but NZD bulls are jumping on the opportunity to find some goodwill towards the Kiwi, dragging the NZD/USD up from the day's lows of 0.6725.
China's Trade Balance shrunk by more than expected as US tariffs on Chinese goods begin to weigh on trade figures; China's trade surplus in USD terms came in at $28.05 billion, below the forecast $39.33 billion and far under the previous reading of $41.47 billion, as imports surged by 27.3% versus the last reading of 14.1%, but the Antipodeans are rolling with the trade headlines, and the Kiwi is jumping up on hopes of rising inflation as NZD traders shrug off China's sagging trade balance; China is a major trading partner for both Australia and New Zealand, and too much pain in the US-China tariff war could see damage done to New Zealand's domestic economy as well.
NZD/USD Technical Analysis
The Kiwi is hopping up on inflation hopes, pushing off of recent swing lows as the pair remains trapped in major consolidation on Daily candles; bulls may have found their impetus for a springboard off of 0.6700 in the RBNZ, but trade continues to be a thorn in the side of the broader Asia-Pacific theater, and a failure to develop meaningful momentum into 0.6800 will drag the Kiwi back down below 0.6700 in short order.
NZD/USD Chart, 15-Minute
| Spot rate: | 0.6752 |
| Relative change: | 0.34% |
| High: | 0.6755 |
| Low: | 0.6727 |
| Trend: | Sideways |
| Support 1: | 0.6727 (current day low) |
| Support 2: | 0.6719 (previous week low) |
| Support 3: | 0.6686 (2018 technical bottom) |
| Resistance 1: | 0.6755 (current week high) |
| Resistance 2: | 0.6834 (previous week high) |
| Resistance 3: | 0.6858 (July 9th swing high) |
Author
Joshua Gibson
FXStreet
Joshua joins the FXStreet team as an Economics and Finance double major from Vancouver Island University with twelve years' experience as an independent trader focusing on technical analysis.
