9 Jun 2015
Trading the RBNZ policy meeting – FXStreet
FXStreet (Barcelona) - FXStreet Editor and Analyst, Omkar Godbole, shares the probable action NZD/USD into the RBNZ policy meeting, discussing the possible price action in the pair as a result of a rate cut or an unchanged policy.
Key Quotes
“1. The pair jumped higher on Monday, thereby confirming a bullish RSI divergence”
“2. Spot bounced from 0.7091 (100% Fib Expansion of 0.7803‐0.7327‐0.7562) earlier today, while the gains have been capped at 0.7178.”
“3. The area around 0.7175‐0.7185 served as a strong technical support in Feb and March. Thus the same level is likely to act as a strong resistance, now that the pair trades at 0.7130 levels.”
“4. In case, the central bank does not cut rates, we are likely to see the unwinding of NZD shorts, thereby leading the pair higher to 0.7175‐0.7185. A break above the same could open doors for 0.7202 (76.4% Fib Expanion) ‐0.7207 (23.6% Fib R of 0.7803‐0.7023). A daily close above the same could see the pair rise to 0.7260.”
“5. On the other hand, a rate cut could lead to a break below 0.7 and push the pair down to 0.6946 (Aug 2010 low).”
“6. Going purely by the chart, the pair looks poised to test 0.7200‐0.7260 levels. Hence, a status quo could very well result in a rally to 0.7260 levels.”
Key Quotes
“1. The pair jumped higher on Monday, thereby confirming a bullish RSI divergence”
“2. Spot bounced from 0.7091 (100% Fib Expansion of 0.7803‐0.7327‐0.7562) earlier today, while the gains have been capped at 0.7178.”
“3. The area around 0.7175‐0.7185 served as a strong technical support in Feb and March. Thus the same level is likely to act as a strong resistance, now that the pair trades at 0.7130 levels.”
“4. In case, the central bank does not cut rates, we are likely to see the unwinding of NZD shorts, thereby leading the pair higher to 0.7175‐0.7185. A break above the same could open doors for 0.7202 (76.4% Fib Expanion) ‐0.7207 (23.6% Fib R of 0.7803‐0.7023). A daily close above the same could see the pair rise to 0.7260.”
“5. On the other hand, a rate cut could lead to a break below 0.7 and push the pair down to 0.6946 (Aug 2010 low).”
“6. Going purely by the chart, the pair looks poised to test 0.7200‐0.7260 levels. Hence, a status quo could very well result in a rally to 0.7260 levels.”