Get started

Rbnz

RBNZ rate decision setup for NZDUSDNext week marks a rate decision event for RBNZ. Currently at 0.25%, there is news in the air for an increase in the rate by 25bp, and possibly another hike before the end of this year. Currently NZDUSD has been flowing more or less in the indicated upward channel. It has fallen due to a strong USD this week and a reversal is in the making. Two highlight points on the chart indicate 1. a slight drop in US retail sales and 2. the RBNZ rate announcement. Provided these events fall in support of the Kiwi, it is expected to bounce up and test the 0.7100 range and possibly further. Point to note: currently the 4h signal shows the reverse from this week's downtrend has already started - however its a Friday!!! I feel like jumping on to the long already but may be worth waiting till NY open or London close to understand the levels better. There's a chance we lose pips on the entry but its a safer play. A well-placed stop may benefit the early birds. See ref. think.ing.com.
Long
by sidnir
AUD/NZD May Extend Losses After RBNZ and New Zealand CPI DataThe recent slightly hawkish RBNZ rate decision and better-than-expected New Zealand second-quarter inflation data is driving local front-end government bond yields higher, especially relative to Australia. AUD/NZD has thus been aiming lower these past few weeks and may continue to do so as it capitalizes on the RBNZ's more hawkish shift compared to the RBA. But, key support remains in focus at 1.0601, which is the May low. Clearing this point exposes the 1.0541 - 1.0564 zone. A bearish crossover between the 20-day and 50-day Simple Moving Averages hints at a near-term downward bias. In the event of a material turn higher, keep an eye on potential falling resistance from March. FX_IDC:AUDNZD
by QM_Dubrovsky
NZDUSD confirms falling wedge bullish formation on RBNZ moveNZDUSD registers the strongest intraday gains in three months after the Reserve Bank of New Zealand (RBNZ) announced plans to tapering bond purchases from late July. The kiwi pair’s ability to confirm bullish chart pattern, falling wedge, as well as a sustained break of 100-SMA, also back the buyers to aim for a 13-day-old horizontal resistance near 0.7095. However, the quote’s further upside needs a daily closing beyond the 0.7100 threshold to aim for early June’s low surrounding 0.7125. Meanwhile, 100-SMA and the upper line of the stated wedge, respectively around 0.7010 and 0.6990, could challenge the kiwi pair’s pullback moves. In a case where the NZDUSD prices stabilize below 0.6990, a downward sloping support line near 0.6910 and the 0.6900 round figure may entertain the bears before directing them to the September 2020 tops near 0.6800. Overall, RBNZ’s ability to join the BOC signals further upside for the NZDUSD.
Long
by MTradingGlobal
ridethepig | NZD for the Yearly Close📌 @ridethepig G10 FX Market Commentary - NZD for the Yearly Close Here we are tracking the weak points in the structure which are strategically important points in every map. They are usually protected and once broken and be rewarding with non-stop moves. The handle to track here is 0.74xx which is well placed and comes to undertaking other duties of preventing the flow back towards 0.883x. Now the early strength of this can be seen with the latest breakup, it is a monthly closing in drastic fashion - a veteran soldier ready to march. A breakdown in Dollar for 2021 is a 'good deed' for the rest of the world but actually we will cover a whole chapter around how it is the only monetary option. After a Biden victory we can expect them to rush through a digital dollar and trigger defaults, things will develop quickly so time to start paying attention for the 2021 flows now. Thanks as usual for keeping the feedback coming 👍 or 👎
Long
by ridethepig
3
Expecting AUDNZD to drift towards 1.04 in the coming months- INGING discussed its expectations for the NZD, RBNZ and AUDNZD in a recent note to clients. RBNZ delivers a surprising hawkish signal The RBNZ announced monetary policy overnight, leaving rates at 0.25% and both its NZ$ 100bn asset purchase programme and the Funding for Lending facility unchanged. Markets had probably built up some expectations that the Bank would start to talk tapering due to bond lower issuance, although no strong direction was given in that sense. All the surprises came from the monetary policy statement, where the Bank published its updated projection for some key economic indicators. For the first time in a year, the RBNZ published the projected path for the OCR (the Bank’s policy rate). A market largely positioned for no change in rates until 2023 was taken off guard by forecasts of a rate hike in the second half of 2022. Investors have moved to price in monetary tightening after the meeting, and the swap market is now pricing in around two 25bp rate hikes by the end of 2022. An upbeat tone on the economic recovery RBNZ Governor Adrian Orr made clear that any projection or forward guidance remains heavily dependent on the path of the economic recovery in New Zealand, which is still highly uncertain. At the same time, the set of economic projections pointed to a clearly improved outlook for the economic recovery. Growth projections for early 2022 were upgraded, with a strong rebound expected for 1Q22 next year (+3.4% year-on-year) after the 0.6% contraction registered in 1Q21, while a stronger expected performance in 4Q21 (1.9%) caused a revision of end-2022 forecasts to 3.5% from 3.7%. Inflation and employment were, however, the two most interesting projections to watch on the economic side. After having consistently overestimated the unemployment rate over the past year, the RBNZ finally erased any temporary jump above 5.0%, with the rate now forecast to decline steadily from the current 4.7% to 4.4% in 2023. Upgraded employment and inflation forecasts A hawkish signal was also sent through the inflation projections, with a revision higher to the headline CPI for 2022 and 2023 of around 0.2%, and the Bank now expecting to achieve a stable 2.2% level in early 2023. The mid-point of the Bank’s target range is 2.0%. Border policy and house prices remain in focus In the policy statement, the Bank highlighted concerns about the tourism sector, whose recovery remains tied to the timeline for a reopening of New Zealand borders. The government has so far said that strict border rules will remain in place until the local population has been vaccinated, although a travel bubble with Australia might have signalled a somewhat less strict approach is on the way. Housing remains a key factor, and it is likely that the hawkish turn is partly motivated by the will to assist the government’s efforts to curb surging house prices in New Zealand. Only 20 days ago, the RBNZ published a note titled: “Why the Reserve Bank is concerned about New Zealand's rising house prices”. Despite having steered away from admitting that housing is now an important input in monetary policy decisions (remember that the NZ government changed the RBNZ remit to include housing considerations), it is hard to imagine government measures being able to counter house inflation on their own while rates remain exceptionally low. Moving forward, the dynamics in house prices will be watched carefully by the market, and any signs that the government’s measures are not enough to curb the housing bubble may well prompt markets to price in an even earlier rate hike by the RBNZ. In April, house prices grew at a slower pace, but still around 19% YoY. NZD: Attractive rate profile to provide extended support While little mention was made about the prospect of tapering, it was highlighted that the Bank will likely fall short of completing all NZ$ 100bn worth of purchases under its quantitative easing programme by June 2022. The RBNZ mentioned lower bond issuance by the government as a key reason, although the 100bn target appeared to be hard to reach regardless of issuance. So far, only around NZ$ 50bn worth of government bonds have been purchased under the programme. We think the next step from the RBNZ will be to start talking tapering. Regardless of whether this will ultimately be a monetary policy related move, we are inclined to think the bank will continue to stress this is due to reduced bond issuance, in an attempt to avoid the unwanted consequences (like a stronger NZD) of sounding too hawkish. In the 2020 Budget (as shown in the chart above), the Treasury revised lower its bond issuance forecasts for 2023 and 2024, after having already cut its forecasts for the period 2022-2025 in the December half-year review. At this point, we could start hearing discussions about ending the asset purchase programme earlier and/or reducing its size. Any tapering signal should not come as a major surprise for markets after the hawkish bias was put in place via the forward guidance tool, but it may all the same continue to support rate expectations. From an FX perspective, we suspect that the jump in NZD seen in the aftermath of the meeting may be the start of a broader cycle of appreciation. With the RBNZ now having joined the likes of the Bank of Canada and Norway’s Norges Bank in the group of hawkish central banks in the G10, NZD is set to reap the benefits of an improved rate profile. Hawkish pricing set to support NZD With inflationary pressures eroding the real rate attractiveness across developed countries, we continue to expect markets to reward those currencies that can count on more orthodox (i.e. less dovish) domestic monetary policy. It is worth noting that the relatively low inflation in New Zealand (1.5%) compared to the likes of Canada (3.4%) or Norway (3.0%), makes NZD even attractive than CAD and NOK from a real rate perspective. We think the RBNZ policy divergence with the Fed (which we expect to stay dovish for longer) is likely to keep generating upward pressure on NZD/USD, pushing it above 0.75 this summer. We also see risks tilted to the upside compared to our latest NZD/USD year-end forecasts of 0.77, as long as our bearish USD view for 2022 materialises. There is a possibility that the RBNZ's hawkish shift may prompt the Reserve Bank of Australia to follow with a less dovish tone. However, the policy divergence between New Zealand and Australia is set to stay in place for longer (Australia’s policy rate is already lower, at 0.10%) and we expect this to keep putting pressure on AUD/NZD, which may drift towards 1.04 in the coming months.
by thunderpips
New Zealand Dollar: NZD/JPY May Rise Post RBNZ, Triangle Break?The New Zealand Dollar may rise in the aftermath of the RBNZ rate decision, where the central bank offered hints at a rate hike during the second half of 2022. It could capitalize particularly against the Japanese Yen, where the BoJ may remain more dovish in the long run. NZD/JPY is attempting to break above an Ascending Triangle, where confirming the breakout could open the door to resuming the dominant uptrend towards peaks from 2018 and 2017. Still, a key risk to the downside could be a material shift in market sentiment that fuels demand for the haven-linked Yen. But, ongoing easing and hesitation to taper from the Fed could keep market sentiment rosy for the time being. Negative RSI divergence does warn that upside momentum is fading, which can at times precede a turn lower. In the event of a drop, keep a close eye on the floor of the triangle as well as the 100-day SMA. These may reinstate the focus to the upside as key support. FX_IDC:NZDJPY
by QM_Dubrovsky
NZDJPY Short off Retest of Trend LineIf you follow me on various social media, you know I have been long in general on the NZD. However, we have a super solid short entry here. Let's take a look. On the 4H chart, we can see a trend line that has held for a few months, since March 21st. This is a relatively solid trend line, as it has been respected 5 times. A few days ago we firmly broke that trend line to the downside. At this point, I put this pair in my watchlist to wait for a retest. And sure enough, we're getting one. Here's the 4H chart below. Keep in mind that at the time of this writing, there are still two hours left in this candle. Now, let's take a look at the 1H chart. The big green candle shows price accelerated into the retest line. However, it was met with a doji, followed by two very bearish candles. Both red candles have long upper wicks (as does the doji) and closed significantly lower. This is a good sign that a reversal is happening. So, let's enter! I will be entering with 2% risk. However, the RBNZ statement is tonight. If we have not hit TP1 by the time the RBNZ nears, I will likely close half of my position and move stop to entry, and get rid of my TP1. Hopefully we can gather some pips to be in a good position before the RBNZ statement and presser. I am in short at 78.755 with: Stop at 79 TP1 at 78.5 (where I will close half of my position and move stop to entry) Limit at 78 Risk of 2%
Short
by MRobertsTrading
ridethepig | NZD for FED📌 ridethepig | NZD Market Commentary 27.01.2021 What is in play here? Buyers depriving shorts of their rewards and not allowing the breakdown ahead of Fed. Strategically speaking, this looks and smells a lot like a slingshot. The strong rejection points towards the Kiwi inflows after RBNZ let slip that rate cuts are unlikely. On the Fed side, dollar devaluation is still the name of the game and a dovish Powell is already widely expected. Not expecting much positivity on the recovery front, positioning is the main factor in play here and a sweep of the highs would be healthy as is the case for EURUSD. Thanks as usual for keeping the feedback coming 👍 or 👎
Long
by ridethepig
4
ridethepig | AUDNZD Market Commentary 20.01.2021📌 ridethepig | AUDNZD Market Commentary 20.01.2021 This chart illustrates the remaining crumbs in AUDNZD which is worth further study. The position from the previous diagrams continues and we are set for taking the next main target at 1.089x/1.090x. Now, buyers have overcome their difficulties in development, the base is optimally protected from AUD inflows via the commodity side. Happy to continue holding AUD against the bird, and is a nice way to express a dovish view on NZD. Thanks as usual for keeping the feedback coming 👍 or 👎
Long
by ridethepig
1
5th Wave Almost Complete - SELL The BreakdownGood evening traders, The NZD has been on a monster rally over the past month. Looking across multiple pairs, the NZDCAD and NZDUSD are setting up very similar scenarios. We can see a nice 5 wave structure higher with a trend line support in play. We are waiting for a breakdown from the trend line support to enter a short position on the pair, expecting an ABC corrective structure. Stop losses will need to go above the most recent swing high. Any thoughts our comments are welcome.
Short
by Trading_Tony
1
ridethepig | AUDNZD Market Commentary 09.12.2020📌 Buyers attacking and maintaining the pressure! Since the initial weakness we spotted at the lows, we have seen the birth of an impulsive leg higher: Of course this is very promising, buyers have much rather played the breakup and we got our momentum gambit! Well, for those wondering what rendered the base as valid, I would point you in the direction of the NZ10Y chart which was calling for the end of NZD strength as soon as we approach the 1.00% target. We must be clear that in AUDNZD 1.055x contains a lot of interest, the ambitious dream of forcing a straight leg towards 1.075x and forcing our opponent into complete capitulation is far from fiction. We can now attack the breakout and force the aggression. The continuation might be 1.055x -> 1.062x -> 1.075x which keeps NZD under pressure. Thanks as usual for keeping the feedback coming 👍 or 👎
Long
by ridethepig
5
ridethepig | NZD Chart of the WeekThis chart update comes after the conversation with @YIQI.... We are tracking how the following elegant defence can hold a breakup through, namely the main target in NZ 10Y Yields: For those who remember, the sweep and breakup was what we had our eye on. A move from 50bps to 100bps was very fancy! And now we have for ourselves a change of scenery! The previous flow must unwind, and in plan of their new attack we can ride the profit taking. Sharp sellers are itching to attack, 0.705x should be able to hold, I am in full sized positions. Thanks for keeping the feedback coming 👍or 👎
Short
by ridethepig
8
ridethepig | AUDNZD Market Commentary 02.12.2020There was apparently no motivation for sellers to continue the advance lower and neither does it seem pragmatic. AUD buyers are showing up once more and this looks like the prelude to an exciting momentum gambit. The trigger comes from a leap above the latent highs, it will move us forward full of energy as shorts start covering and the youthful arrogance of those reluctant to close get margin called. I choose to answer the lows with a gentle position, no more than one or two in the start, and the quietness of a worthwhile virtue. The whole business of markets is about the advance for our momentum, because the traps have already been set, sellers still think they have won, but only when we zoom out on the macro charts can we truly demonstrate the underlying AUD strength. So I would tend to describe the above floor as cheap and open. With clearing month end flows and markets trying to get their 2021 trades on early with commodity shortages entering into the picture already, we should emphasise exposure in AUD. Of course, Australian and China relationships are not working perfectly, although I expect this will be the story to track in 2021 rather than December 2020. Thanks as usual for keeping the feedback coming 👍 or 👎
Long
by ridethepig
9
ridethepig | NZDUSD Market Commentary 2020.11.25📍 My dear readers, it is clear what we are trying to achieve here.... a protection of the highs / resistance with initial targets at our centre / pivot and extension targets below at support. The control which belongs to buyers is blockaded and open to attack. It is expensive to maintain the highs; this means that the necessary pullback when energy exhausts is all too easy to ride. It appears quite appropriate to consider the Dollar selloff exhausted and an advance in DXY via extreme risk-off flows as investors look for cover under the table. Keeping a close eye on 0.70c as it turns out to be deceptive for buyers as the government is clearly feeling pressure from the RBNZ QE approach. Look to buy NZD but from cheaper levels, until then... looking to play the retrace lower. Thanks as usual for keeping the feedback coming 👍 or 👎
Short
by ridethepig
6
ridethepig | Replacing the defence in NZ YieldsComparing NZ 10Y Yield with AU 10Y Yield we can see the divergence opening up. The local stories in NZ are looking a lot worse than in Australia for now, depriving the NZ 10Y Yield of completing the base formation. On the currency side, the strategic link between AUD and NZD is being threatened by AUD breaking up and flirting to complete the leg towards 1.12 - something we have been tracking since June: On the technical flows, the NZ10Y can sweep 0.5% comfortably, where it would be then able to replace the current defence with a more solid structure for a move back towards 1.0%. Thus the 🔑 to answering direction for NZ10Y comes only with more time elapsing.
TVC:NZ10YLong
by ridethepig
2