Fundamental Analysis of NZDUSD for January 5, 2018

NZD has been quite positive with the economic reports this week which reflected the impulsive gains against USD this week, leading the price to the 0.7150 resistance area recently. This week NZD GDT Price report was published with a significant increase to 2.2% from the previous negative value of -3.9%. The positive economic report did help NZD to gain impressive momentum over USD which lead to 90 pips of the bullish move yesterday despite having positive economic reports from the US. Today on the USD side, USD Average Hourly Earnings report is going to be published, which is expected to increase to 0.3% from the previous value of 0.2%; Non-Farm Employment Change is expected to decrease to 190k from the previous figure of 228k; Unemployment Rate is expected to be unchanged at 4.1%; and ISM Non-Manufacturing PMI is expected to have a slight increase to 57.6 from the previous figure of 57.4. Along with these high-impact economic reports, today USD Trade Balance report is going to be published, which is expected to show a greater deficit of -49.7B from the previous negative figure of -48.7B; Factory Orders are expected to show a significant increase to 1.1% from the previous negative value of -0.1%; and FOMC Member Mester is going to speak today about the upcoming economic and monetary policies which is expected to be neutral in nature. To sum up, USD is expected to recover its grounds, which it lost against NZD today if the high-impact economic reports turns out to be better than expected though the forecast is quite mixed. If USD manages to gain momentum and close the week with a bearish momentum, then further bearish pressure can be expected to hit the market in the coming days.

Now let us look at the technical view. The price is currently residing just below the resistance level of 0.7170, where the price is expected to push lower towards 0.7050 and later towards the 0.6850 support area. As the price is residing below an important event level from where the price pushed lower previously, so this time any positive economic report on USD may result in impulsive bearish pressure as well. As the price remains below the 0.72 price area with a daily close, the bearish bias is expected to continue further.


The material has been provided by InstaForex Company -