- NZD/USD: a bear engulfing candle formed, where next?
- NZD/USD shrugs off ME tensions, risk-on supporting early.
NZD/USD is starting out the week in a narrow range of a handful of pips so far, despite an offer in gold and risk on stock prices with the S&P bid up with an opening gap on the charts. Currently, NZD/USD is trading at 0.7350 with a high of 0.7355 and a low of 0.7347 in a risk-on market.
Risk tone: well, so far so good, just another attack on Syria, market moves on . . .
Traders were braced for a potential risk-off start to the week considering the escalating tensions in the ME and political concerns in the White House. However, there seems to be an off-set here with better-looking trade outlooks instead. (China GDP is up this week as first key data catalyst).
A hard environment for the Kiwi
"An escalation in geopolitical tensions is likely to limit the upside moves in the NZD, at least early this week," analysts at ANZ argued, adding, "however, with it becoming clear that we are entering a softer global growth environment, on top of the lift in volatility we have already seen, we are still of the view that it is becoming a harder environment for cyclical currencies, like NZD."
On the daily sticks, bear engulfing candle formed at the close of business last week with the RSI diverging from the new short-term high and price well below the 0.7440 mark, (16th Feb highs). To the downside, the key target is the 0.7180 level.
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