EUR/NZD broke the March trendline following Wednesday’s RBNZ meeting. Now approaching the June low, we could see a corrective bounce towards resistance and pave the way for two bearish potential patterns we’re monitoring.
- Since Wednesday’s RBNZ meeting, where they held rates but were less dovish than expected, NZD crosses have retained strength. With G20 meetings now underway, commodity pairs will likely have a binary effect depending on how successful talks between Trump and Xi are perceived to be.
- NZD strength has forced EUR/NZD to close two days below the bearish trendline and, as it traders near the June, low, we expect a bounce higher, whether technically or G20 driven. However, beyond here we see potential for a bearish swing trade back towards the June low. And, if that gives way, a larger bearish reversal could be underway.
- It’s not the only commodity pair that is taking advantage of European weakness. As we see that GBP/AUD has indeed rolled over and we continue to suspect a larger-bearish reversal is underway since breaking the June low.
Disclaimer: The information and opinions in this report are for general information use only and are not intended as an offer or solicitation with respect to the purchase or sale of any currency or CFD contract. All opinions and information contained in this report are subject to change without notice. This report has been prepared without regard to the specific investment objectives, financial situation and needs of any particular recipient.
Any references to historical price movements or levels is informational based on our analysis and we do not represent or warrant that any such movements or levels are likely to reoccur in the future. While the information contained herein was obtained from sources believed to be reliable, the author does not guarantee its accuracy or completeness, nor does the author assume any liability for any direct, indirect or consequential loss that may result from the reliance by any person upon any such information or opinions.