EURNZD Lower
Updated
Trying EURNZD lower.
Narrative for the EUR has changed somewhat, while we still have a relatively hawkish ECB we also have falling EU inflation and worsening EU data. the ECB meeting also i imagine makes a lot of the longs in the EUR a little nervous given the way data has been coming out. NZD still has a rate advantage and with china performing better i think it could benefit as well.
correlations suggest lower, rate differentials are pointing lower, china is performing better.
sentiment and positioning are very long EUR which could help with downside potential.
risk here would be a risk off mood, from what i can see based on scheduled events the things that would cause this are US CPI and the fed rate decision. Most expect the fed decision to be a hawkish skip so this is likely priced in and US CPI i am uncertain of so will keep an eye on that.
not trading/investment advise, feedback welcome!
Narrative for the EUR has changed somewhat, while we still have a relatively hawkish ECB we also have falling EU inflation and worsening EU data. the ECB meeting also i imagine makes a lot of the longs in the EUR a little nervous given the way data has been coming out. NZD still has a rate advantage and with china performing better i think it could benefit as well.
correlations suggest lower, rate differentials are pointing lower, china is performing better.
sentiment and positioning are very long EUR which could help with downside potential.
risk here would be a risk off mood, from what i can see based on scheduled events the things that would cause this are US CPI and the fed rate decision. Most expect the fed decision to be a hawkish skip so this is likely priced in and US CPI i am uncertain of so will keep an eye on that.
not trading/investment advise, feedback welcome!
Note
taking this out at 1.7575, i am a little bit skeptical of the idea as it makes sense but also has too big a risk of a move higher if risky assets start to fall
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