EUR/NZD Showing Bullish Wave 3 Pattern After Moving Up 200+ Pips

The EUR/NZD is showing a strong bullish reversal at the Fibonacci levels and bullish breakout above the resistance. The bullish outlook was expected in our previous analysis where we analysed that a reversal was around the corner.

This article will review whether the reversal can go up even more and if so, what kind of targets are within reach.

Price Charts and Technical Analysis

EUR/NZD 23.03.2021 4 hour chart

The EUR/NZD made a strong bullish breakout above the resistance trend lines (dotted orange lines). This occurred after price action completed an ABC pattern (grey) without breaking the bottom of wave 1 or A (pink).

  1. The bullish bounce at the 61.8% Fibonacci retracement level is typical for a wave B zigzag pattern of an ABC (pink).
  2. But price could also be building a larger 123 pattern (pink) as well. This depends on how far the price will move up in the third wave.
  3. Currently price is closing to reaching the -27.2% Fibonacci target. A break above the -100% Fib target indicates a wave 3. Anything below that could be either a wave 3 or C.
  4. Price action could make a retracement at the -27.2% Fibonacci target and Wizz 7 Fibonacci confluence level for a pullback.
  5. The pullback should be shallow and show a continuation pattern such as a bull flag (grey arrows) if the uptrend is to remain valid.
  6. A break above the pattern (green arrow) indicates the continuation.
  7. Only a deeper pullback places the uptrend scenario on hold (yellow button) or invalidates it (red button).

On the 4 hour chart, price action is showing a wave 1-2 pattern. The current strong impulse – which broke above the -100% Fibonacci target – is typical for a wave 3 (orange), either of a larger wave C or 3 (pink) which is yet to be determined.

  1. The current strong impulse – which broke above the -100% Fibonacci target – is typical for a wave 3 (orange), either of a larger wave C or 3 (pink) which is yet to be determined.
  2. We are soon expecting some type of pullback. The -161.8% Fibonacci target could be a logical spot for such a retracement.
  3. A shallow pullback via a bull flag pattern makes the most sense in this case (grey arrows).
  4. The pullback could go back to the price zone of around 1.6830, 1.6780, or 1.6750 where a bullish bounce is expected (green arrow).
  5. The main target of the next push up is the confluence at the 1.70 with a Wizz 8 level and -200 FIbonacci target.

EUR/NZD 23.03.2021 1 hour chart

Good trading,

Chris Svorcik

The analysis has been done with the indicators and template from the SWAT method (simple wave analysis and trading). For more daily technical and wave analysis and updates, sign-up to our newsletter 

For a look at all of today’s economic events, check out our economic calendar.

Weekly Forex Commentary March 14, 2021

EUR/USD ranges this week severely diminish due to problems within the EUR universe. EUR/JPY remains light years overbought while EUR/NZD and EUR/CAD maintain oversold conditions. EUR/CAD broke its 5 year average at 1.4955 and trades ranges from 1.4955 to 1.4547 then 1.4427. EUR/GBP is oversold however it trades between 0.8740 to 0.8414 to the 5 and 10 year average. EUR/USD cross pairs will determine EUR fate this week to direction. 

GBP/NZD from this week’s close at 1.9374  sits on supports at 1.9330 and 1.9246. Last week vitals from 1.9318 to 1.9188 and the week prior 1.9318 to 1.9176. GBP/AUD from its close at 1.7927 contains resistance at 1.7934 then 1.8134 and last week 1.8130 to 1.7905 then 1.7885 to 1.8130. Both are problem pairs entering into the new week.

Week 7 to massively overbought JPY cross pairs. For the month, NZD/JPY rose 100 pips, barely 200 for AUD/JPY and EUR/JPY, 400 for GBP/JPY and a rare day for 400 pips to CAD/JPY. CAD/JPY beat USD/CAD by 100 pips as USD/CAD traded 300 pips. traditionally, USD/CAD always trades wider ranges than CAD/JPY as CAD/JPY is the follow pair to USD/CAD.

USD/CHF and USD/JPY begin the week deeply overbought while USD/CAD is severely oversold. The strategy this week is long USD/CAD, short CAD/JPY and refrain from trading laggard currencies, USD/CHF and USD/JPY. For problem pair USD/JPY lower must break the 5 year average at 108.98 then 106.43. Above at 109.00’s and 110 is maximum to USD/JPY averages dating to 1999. 

While GBP/JPY and GBP/CHF are overbought, GBP/CAD matches EUR/CAD to oversold and GBP/NZD and GBP/AUD as problem pairs. GBP/USD like EUR/USD is hostage to its cross pairs for direction. 

AUD/CAD and NZD/CAD both broke below vital points at 0.9737 and 0.9073. With NZD/CAD’s break lower, NZD/USD’s close at 0.7173 sits 53 pips above its vital break at 0.7120. Overbought NZD/JPY and NZD/CHF will assist NZD/USD’s eventual break at 0.7120. Then AUD, GBP and EUR slide further. 

AUD/USD big break lower is located at 0.7641. AUD achieves this challenge by breaks lower at 0.7716 and 0.7679. 

Gold remain inside 1815 to 1642. DXY 91.43 Vs 92.78 and 89.95 below. The 2 year yield broke above reported 0.1511 to trade 2 points higher to 0.1711. The 10 year yield at its 1.625 close, trades inside its wide ranges from 1.3305 to 1.8448. 

Respectfully readers, I work extraordinarily hard consistently over 17 years to write the most accurate levels, entries and targets, to bring the most accurate data and market concepts. Don’t believe my words as all is documented here.

EUR/NZD Bullish Reversal After Bounce at Key -27.2% Fib Target

Tthe EUR/NZD has made a bullish bounce at the -27.2% Fibonacci target. Is this pair ready for a larger reversal after its 3,500 pip decline?

Price Charts and Technical Analysis

EUR/NZD 12.03.2021 daily chart

The EUR/NZD downtrend is not officially over yet. But there is a fair chance that a bearish ABC (purple) pattern has been completed at the most recent low.

  1. A bullish breakout above the 21 ema zone and the resistance trend line (orange) confirms the bullish reversal (green arrow).
  2. The first target is the 144 and 233 ema zone.
  3. A bull flag pattern in this ema zone could indicate more upside.
  4. A strong push up could confirm a wave 1 or A (pink).
  5. A bearish break, however, below the -27.2% Fib target invalidates (red circle) the bullish reversal and indicates a continuation of the downtrend.

On the 4 hour chart, the bullish price swing seems to be a 5 wave pattern up (grey). This is probably a bullish wave 1 (grey – or a wave A).

  1. The current pullback is choppy and corrective and could be a wave 2 (orange).
  2. The wave 2 outlook remains valid as long as price action remains above the bottom and 100% Fib. A break below it invalidates it (red circle).
  3. A deeper bearish pullback (red dotted arrows) is expected to test the Fibonacci retracement levels and bounce (blue arrows).
  4. An immediate bullish breakout (green arrows) could indicate the end of wave 2 (orange) and the start of a wave 3 (orange).
  5. A bull flag pattern (grey arrows) could indicate more upside after the break (green arrow).

EUR/NZD 12.03.2021 4 hour chart

Good trading,

Chris Svorcik

The analysis has been done with the indicators and template from the SWAT method (simple wave analysis and trading). For more daily technical and wave analysis and updates, sign-up to our newsletter

For a look at all of today’s economic events, check out our economic calendar.

Weekly Commentary – EUR, USD and GBP

EUR/USD 1.2061, AUD/USD 0.7657 and USD/CAD 1.2783 decide future and current direction to all 28 currency pairs. EUR/USD and AUD/USD breaks then much lower or much higher. USD/CAD breaks 1.2783 then much higher or a failure to break then much lower.

JPY cross pairs remain overbought and reveal EUR/USD and AUD/USD will eventually break lower and USD/CAD breaks higher. GBP and NZD will then follow lower.

Not a driver to market prices this week are the typical alarm bells written by market writers with specialization in marketing rather than expertise in markets, trading and market prices. Elections, Covid, lockdowns, vaccines, central bank meetings, yields, month-end, Fed, Powell and the Mars rover landing failed to move market prices. Not at the time of release nor in subsequent trade days did prices move except to the degree intended from the start of the day or week.

A market price will achieve its destination by mathematical certainty without regard to outside events yet professional alarm bell ringers are surprised at a rise in yields, no movements to NFP and central bank meetings and to a price that fails to respond to their sounding of the bells in the market square.

NFP and fed meetings barely moved EUR/USD 20 pips in each of the last 6 and 8 months. Whistleblowers month-end and rebalance will be heard this week. Meanwhile, monthly averages haven’t changed in many months and a rebalance nor month-end changes to prices fails to exist as price fail to move enough to require changes to averages.

DXY monthly averages remain inside 89.95 to 91.43, Gold 1815 -1642. EUR/USD traded 1.1900’s -1.2200 in February, 1.2000’s to 1.2300’s in January. The 2 year yield traded 0.11 to 0.23 in the past 9 months. The S&P’s traded 300 points from 3900 to 3600 for February, 200 points for January. WTI traded 10 points in February from 51.00 to 61, and 6 Points for January.

Our professional alarm bell ringers are long on whistles but short on market competency. A Necessary yet least favored aspect to market prices, trades, and economics is the requirement to run and enter data for a clear picture of entries and exits and to understand the economic condition. But market prices and profits were never nor will ever be the ultimate goal to reporting.

The Week

The ultimate revelation to a cautious market this week is found in GBP/AUD and GBP/NZD. GBP/AUD at 1.8059 resides inside vital range points from 1.7885 to 1.8130 and GBP/NZD at 1.9318 to 1.9176. Both GBP/AUD and GBP/NZD from oversold last week drifted higher directly into a neutral zone for this week.

EUR/AUD and EUR/NZD however are deeply oversold and contains the ability to travel higher while GBP/AUD and GBP/NZD remain stuck in neutrality.

EUR/USD led the charge higher for non USD pairs upon the break of the 5 year average at 1.1300’s last July and is in the position to take down GBP, NZD and all non USD pairs. GBP/USD must break 1.3600’s and NZD/USD 0.7100’s to assist in a wholesale trend change.

Deeply oversold USD/CHF at 0.9084 broke higher from 0.9001, CAD/ZAR trades above 11.86 and USD/CAD is on the verge of a break higher at 1.2783.

GBP/USD retains slightly overbought status while next highest exchange rate GBP/JPY is deeply overbought and next lowest GBP/CHF also opens the week in richter scale overbought. Same situation exits for EUR/USD, AUD/USD and NZD/USD as EUR/CHF and EUR/JPY are both overbought. NZD/CAD and AUD/CAD offer no assistance as leaders to NZD/USD and AUD/USD direction as both sit in neutrality.

EUR/GBP challenges 0.8732 on a break of 0.8573 or a drift to 0.8400;s. EUR/GBP traded to exactly 0.8728 Friday then lower to close at 0.8655.

DXY remains in a 89.95 to 91.43 range and a break higher at 91.43 challenges 92.78.

For a look at all of today’s economic events, check out our economic calendar.

Weekly Round Up – February 21st, 2021

AUD/USD broke its long standing and much written line at 0.7821 and traded 57 pips to 0.7877. Above 0.7821, AUD/USD ranges between 0.7821 to the 10 year average at 0.8305 or 484 pips. Below 0.7821, AUD/USD trades 0.7821 to 0.7308 or 513 pips. Below 0.7821 exists 0.7605.

DXY last week maintained its 148 pip range between 89.95 to 91.43. Above 91.43 next targets 92.78 in a 135 pip range.

GBP as written in the last post maintains deep overbought status across all GBP pairs except GBP/NZD. Watch 1.9136 this week for best moves.

EUR/USD opens in fairly perfect neutrality however ranges continue to compress. Problem pair EUR/JPY and all JPY cross pairs maintain deeply overbought status for week 4. EUR/CAD, EUR/NZD and EUR/AUD open the week massive oversold. EUR/CAD and EUR/AUD will provide the best moves.

Stand clear EUR/CHF as AUD/CHF and NZD/CHF will provide better movements.

NZD/USD 0.7267 then 0.7356 Vs 0.7267 and 0.7990. NZD/CAD is overbought while NZD/JPY heading into week 4 maintains richter scale overbought status.

Overall, NZD/USD traded 200 pips from 0.7100’s to 0.7300’s for the past 2 months and provided support to GBP and AUD to allow both to move higher. Explains the divergence seen in EUR/NZD Vs GBP/NZD this week.

USD/JPY watch 104.97 and USD/CAD 1.2587 Vs 1.2826.



EUR/USD Vs USD/JPY and the FX Cross Pair Divide

Overall currency markets are in the great deadlock between natural opposites EUR/USD and USD/JPY. Current USD/JPY at 105.74 trades 84 pips above its vital high/ low point at 104.89. This line is rising. EUR/USD trades around its current high /low point at 1.2039. This line moved 1 pip lower since yesterday’s ECB at 10 A.M. EST. EUR/USD and USD/JPY achieved its crowning achievement by rhe great divide to currency pairs.

USD/CAD at 1.2600’s and GBP/USD at 1.3800’s or 1200 pips informs this distance is far to wide. GBP/USD trade to 1.4000’s while USD/CAD was located at 1.2500’s or 1500 pips assisted to diminish the distance yet 1200 pips informs a big move is ahead. Normal distance is 3 to 500 pips.

For the past four weeks as written, JPY cross pairs were and continue to trade in severely overbought territory. The degree of overbought is recognized as 500 pips from AUD/USD 0.7700’s and AUD/JPY at 82.00’s and 500 pips from NZD/USD 0.7100’s to NZD/JPY 76.00’s. Normal is in the vicinity of 100 to 200 pips maximum because NZD/USD and NZD/JPY are the exact same currency pairs much the same as AUD/USD and AUD/JPY.

The divide grows wider at 800 pips from GBP/USD 1.3600’s to GBP/JPY at 147.00’s and 700 pips from EUR/USD 1.2000’s to 127.00’s for EUR/JPY and normal is 100 to 200 because GBP/USD and GBP/JPY are the exact same currency pairs much the same as EUR/USD and EUR/JPY.

USD pairs EUR/NZD at 1.6700’s trades 2500 pips to GBP/NZD 1.9200’s. Normal trades around 1600 to 1800 pips and 700 pips off kilter.

The EUR/USD and USD/JPY relationship is distinguished by the massive and extreme divide between and among currency pair prices, particularly USD and overall cross pairs as the primary driver to current prices.

Today’s trade is presented as a two trade option by matching significant day trade support, resistance and levels. Short the highs and long the lows.

USD/JPY highs Vs EUR/USD Lows.

USD/JPY up target 106.43 vs EUR/USD 1.1985 lows.

USD/JPY 106.36 Vs EUR/USD 1.1998.

USD/JPY 106.29 V EUR/USD 1.2011

USD/JPY 106.16 Vs EUR/USD 1.2015

USD/JPY 106.09 Vs EUR/USD 1.2023

USD/JPY 106.03 Vs EUR/USD 1.2028.

USD/JPY 105.96 Vs EUR/USD 1.2034.

EUR/USD Highs Vs USD/JPY lows

EUR/USD 1.2107 Vs USD/JPY 105.37

EUR/USD 1.2099 Vs USD/JPY 105.44

EUR/USD 1.2091 Vs USD/JPY 105.51

EUR/USD 1.2076 Vs USD/JPY 105.58

EUR/USD 1.2068 Vs USD/JPY 105.63

EUR/USD 1.2061 Vs USD/JPY 105.71

EUR/USD 1.2053 Vs USD/JPY 105.79

EUR/USD 1.2049 Vs USD/JPY 105.87.

EUR/USD is a complete opposite pair to USD/JPY however prices never match pip for pip as the relationship runs 7.62 pips for EUR/USD Vs 6.62 for USD/JPY.As a side note all market prices especially Stock Indices are factored the exact same as a currency price. The difference is in the name and number yet its all the same.

Not many pips trade anymore as the old days of trading therefore pips and profits are maximized by multiple longs and shorts per currency pair. All information is known in advance of the trade therefore no stops, charts and whatever is needed nor applied.

Are We One Step Closer to a Major Correction?

Gold advances higher after the breakout from the flag formation.

Brent with a potential double top formation.

Nasdaq escaped from the rising wedge pattern.

DAX bounced from the horizontal resistance again and it is starting to look ugly.

EURUSD with a triple top formation.

EURJPY drawing a possible false breakout pattern. Major sell signal on the horizon.

EURNZD going lower after the price broke the lower line of the flag and later tested it as a resistance.

For a look at all of today’s economic events, check out our economic calendar.

EUR/NZD Deep Retracement for Fresh Buying

The EUR/NZD has formed a consolidation pattern around 88.6 fib, straight in the 78.6-88.6 trading zone.

The price might move straight from the zone towards D H3 – 1.7790 and W H3 -1.7819. Have in mind that a momentum push is needed above 1.7755 for the price to sustain its move higher. The price has already made a test of 78.6 – 1.7755 but failed to break it. However, a 1h candle close above next time should provide much needed bullish impulse.

For a look at all of today’s economic events, check out our economic calendar.

Stocks Erase Tuesday Loses, On The Way Towards New Highs Again.

Stocks erased Tuesday’s loses and are heading significantly higher.

EURUSD fell back below crucial support and are now testing the lower line of the flag.

EURAUD still locked inside of the long-term range.

AUDNZD breaks the neckline of the inverse head and shoulders pattern and the upper line of the flag.

USDJPY creates a small pennant after breaking major long-term dynamic resistance.

EURNZD with the head and shoulders pattern but the first attack on the neckline was unsuccessful.

NZDCAD with a head and shoulders pattern but the first attack on the neckline was unsuccessful too.

For a look at all of today’s economic events, check out our economic calendar.

New Zealand Dollar Finally Recovers

In today’s Trading Sniper video, we will focus on the strength of the New Zealand Dollar. NZD is coming back to life after rather unsuccessful past few weeks. All this is happening rather without any support from the fundamentals. We did not have any important news from the New Zealand economy, actually if so, then negative as New Zealand stock exchange is halted for the third day following the cyber attack. Currency does not care about that though and the buyers are continuing the shopping time.

We will start with the NZDUSD, where the pair is climbing higher after the bullish breakout of the upper line of the flag. That gives us a buy signal with a potential target on the long-term down trendline. Chances that we will get there are pretty high.

Now GBPNZD, where the price is going lower after creating the head and shoulders pattern. We already broke the up trendline and the neckline of this formation. Sentiment is negative and the price should go as low as to 38,2% Fibonacci.

EURNZD is having pretty much the same situation. We also have a head and shoulders pattern with the already broken neckline. After the breakout, the price fell sharply and is currently aiming the mid-term up trendline. It looks like we will get there pretty soon.

For a look at all of today’s economic events, check out our economic calendar.

EUR/NZD Smooth Ride Up Hits Fibonacci Target

The EUR/NZD has built a strong bullish impulse. But price action has reached one of the main targets at Wizz 8. Could this create a correction?

Price Charts and Technical Analysis

EUR/NZD 4 hour chart

A shallow pullback at Wizz 8 is indeed expected – despite the strong momentum. A bull flag or triangle pattern would confirm the potential wave 4 (orange) pattern. A breakout above the Wizz 8 level indicates an immediate continuation. Whereas a break below the support (purple) invalidates it (red x).

SWAT traders had the opportunity to find long setups based on momentum confirmation. As mentioned in the live SWAT webinar, this was indicated by the green dots and blue diamond (green box). Price action swiftly hit the target at Wizz 8 for about a +120 pips win. Now the question is whether the bullish swing is part of a wave 3 or C (purple). This will depend on the price action at the support zone.

EUR/NZD 4 hour chart

Good trading,

Chris Svorcik

The analysis has been done with the indicators and template from the SWAT method (simple wave analysis and trading). For more daily technical and wave analysis and updates, sign-up to our newsletter

For a look at all of today’s economic events, check out our economic calendar.


Daily Forex Briefing 29/07/2020

In today’s Daily Briefing, we found those amazing setups we thought you’d find interesting!

EUR/PLN bouncing from a crucial support on the 4,4.

Brent with a possible false bearish breakout and an upswing but still below important resistance.

EUR/USD awaits the FOMC inside of a pennant.

USD/JPY is getting ready to test the 106 as a resistance.

EUR/CHF bouncing from the upper line of the flag.

GBP/NZD with a major, long-term buy signal.

EUR/JPY finishing a big inverse head and shoulders pattern.

EUR/NZD with a double bottom formation but still below important resistance.

SP500 drawing a head and shoulders pattern but buyers have an appetite for an upswing.

CAC in a slightly worse position but still fighting on a major up trendline.

For a look at all of today’s economic events, check out our economic calendar.

EUR/NZD Bearish Breakout after ABC Pullback at 144 EMA

The EUR/NZD is in an established downtrend. Price has recently made an ABC pullback towards a heavy resistance zone (red box). What’s next?

4 hour chart

EUR/NZD 4 hour chart

The EUR/NZD needs to break below the 21 ema zone and the support trend line (blue) to confirm the downtrend continuation (green check). A breakout, flag, and continuation pattern would be the best pattern for any potential short setups. The main targets are the round level of 1.70 and 1.6925.

A break above the long-term moving averages would break indicate a break above resistance and invalidate (red x) the bearish outlook. The current pullback is probably an ABC (blue) wave in wave 4 (purple). The bearish breakout could complete a wave 3 (purple).

EUR/NZD chart

Good trading,

Chris Svorcik

The analysis has been done with the indicators and template from the SWAT method (simple wave analysis and trading). For more daily technical and wave analysis and updates, sign-up to our newsletter


EUR/USD Price Forecast – Euro Breaks Down Towards 50 Day EMA

The Euro has broken down a bit during the trading session on Friday, reaching down towards the 50 day EMA after there was a bit of a “risk off” type of feel early in the session. However, the 50 day EMA is starting to offer support, and therefore it’s likely that the market will continue to see a lot of choppy back-and-forth type of trading, but at this point the market looks to be paying attention to the 1.11 handle, which is the middle of the when it comes to the overall trading ranges between the 1.12 level above and the 1.10 level underneath. In other words, we are essentially at “fair value.”

EUR/USD Video 20.01.20

Looking at the chart, I would fully anticipate that there will be some type of bounce year but if we were to break down below the 1.1075 level, then it opens up the door down to the 1.10 level underneath. All things being equal, I think we are still going to be trading in this 200 point range going forward, because quite frankly this pair doesn’t know what to do with itself. If you are a short-term trader, you may get a short-term buying opportunity but don’t expect more than about 15 or 20 pips on any move. If we do break out of this 200 point range, then we could get something going but, in the meantime, I would ask for too much as this is a market that simply has nowhere to be anytime soon. The European Union is relatively weak right now, and the Federal Reserve is nowhere near tightening its monetary policy. In other words, we will see more of the same.

Please let us know what you think in the comments below

Three Great Setups With Weaker AUD and Stronger NZD

It can be nicely seen on our first instrument: AUDCHF, where the price is drawing a beautiful hammer on the daily chart. This long tail, shows us a rapid strengthening of the CHF, followed by a fast reversal. In overall, the situation is negative. Few days ago, AUDCHF broke the lower line of the symmetric triangle pattern along with the horizontal support on the 0.669. Price closing below the orange support gave us a significant sell signal. Today’s hammer is really not changing much here.

I will continue with the AUD and show You an interesting setup on the AUDNZD. Here, yesterday, the sharp drop gave us a long-term sell signal. The pair broker the lower line of the descending triangle pattern and the lower line of a channel up formation. According to the all books about the technical analysis – that is a very negative situation promoting a further drop.

Two above setups show us a weakness of the AUD and the latest – additional strength of the NZD. Kiwi’s power can be confirmed by the situation on the EURNZD, where we do have a very handsome reversal. I must admit that this setup is really classic. We do have a bullish correction, ending on the down trendline, 23,6% Fibo and the horizontal support on the 1.68. In addition to that, the price draws a long head. Really it rarely gets much better than this. The pair is dropping quite significantly and there are big chances that we are going to witness new mid-term lows soon.

This article is written by Tomasz Wisniewski, Director of Research and Education at Axiory

EUR/NZD Counter Trend Move Should Happen Now

Dear Traders,

The EUR/NZD is at critical support. Monthly L5 level has already been reached so I expect a counter trend move off the W L3 support.

A bounce off the 0.6620 is possible right now. Counter trend trade should aim for 1.6690 as the first target. If the market makes a 4h close above 1.6716 then we could see 1.6790 and 1.6806. However, we might wait for couple of days for EUR/NZD to reach its target as today is Dec 31 and we have New Year holidays soon.

Happy NEW YEAR everyone! Don’t Forget to join the winning team in 2020!

The analysis has been done with the CAMMACD.MTF template.

For more daily technical and wave analysis and updates, sign-up up to our ecs.LIVE channel.

Many green pips,
Nenad Kerkez aka Tarantula FX
Elite CurrenSea

EUR/NZD Bullish But at a Crucial Support

Dear Traders,

The EUR/NZD has spiked yesterday but then dropped during the night as NZD gained bullish momentum. However, it is still bullish.

The pair is at a crucial support which is formed by the confluence if ATR pivot, Weekly L4 and Wizz base level. A bounce from 1.7300-30 is bullish and targets are 1.7372 and 1.7427. Above 1.7427 we should expect W L3 camarilla to be hit – 1.7486. However a loss of 1.7275 might probably tank the pair to 1.7200 and make it neutral.

The analysis has been done with the CAMMACD.MTF template.

For more daily technical and wave analysis and updates, sign-up up to our ecs.LIVE channel.

Many green pips,
Nenad Kerkez aka Tarantula FX
Elite CurrenSea

Aussie Jobs Have Traders Testing the 69-handle

AUDUSD testing 69c

The Aussie employment data has seemingly only fuelled the AUD bears belief for further downside, with the unemployment rate ticking up to 5.2%, driven by a higher participation rate at 66.0%. Granted, we saw a revision higher to last month’s print, but with 42,300 net jobs created in May, 94% of these jobs were part-time. The market has told us what they think though, and while we have seen a small downside in the AUD, the currency has reacted to a 3bp move lower in the Aussie 3-Year Treasury, which is threatening to break 1%. The implied probability of back-to-back cut from the RBA in July sits at 65%, so with the unemployment rate now 70bp above full employment, the market says a July cut is on and we have it reasonable to expect a lower cash rate.

One focus in yesterday’s commentary was the set-up on the EURNZD daily. After the break of the January and 23 May highs, price action lacked conviction from the bulls, resulting in a clear failed break of the 1.7209 resistance level. I was keen to see if the move through resistance, with recoil back to confirm support, and as we have seen, that wasn’t the case. It’s for this reason why I tend to wait for a close above a resistance level (on a set time frame) to feel there is an increased probability that we’ll see a continuation of the underlying trend.


EUR negative headlines

EURNZD aside, we saw a number of EUR negative headlines. Trump detailing that he will consider using sanctions if Germany commences the construction of a gas pipeline between Russia and Germany. As was credit rating agency Fitch issuing a warning on Italy’s fiscal position, although this was largely overlooked, but certainly worth noting given Fitch is due to review Italy’s sovereign rating on 9 August. We also heard from an ECB member Coeure, who suggested the global outlook was worsening and the central bank stands ready to support if needed.

EU inflation expectations at record lows

We can look at EU 5-year inflation expectations, which we monitor through swaps pricing. At 1.1590%, we have never seen expectations this low, and while this would have been impacted by a punchy sell-off in the oil market, current levels have to worry the ECB who would be doing the numbers on renewed asset purchases. Either way, I have my eye on a daily close above 1.7209 and what is obvious supply zone on EURNZD.

We have to consider the moves in EURUSD too, as the sellers waded in pretty much as soon as we breached Tuesday’s high of 1.1337. We saw an outside period on the pair and thus a move below yesterday’s session low of 1.1283 (in the period ahead) would suggest a test of horizontal support just below at 1.1260. The fact the EUR has a 57% weight on the US dollar index (USDX on MT4/5) has seen an interesting move in this market too, with the USDX rallying off the 200-day MA, in what can be considered a position adjustment. Granted, we have seen further tweets and narrative on trade from Trump, but it’s interesting to see USD strengthen, considering US CPI came in below expectations at 1.8% headline and 2% core, with US 2-year Treasuries closing 5bp lower at 1.87% and the implied probability of a July cut (from the Fed) pushing up a touch to 81.5%.


USDJPY looks interesting here, with a price printing a series of higher lows with increasing (candle) wicks, showing the buyers have probably got the upper hand for now. Again, a position adjustment, but the price is forming a bear flag, and a close through the lower channel support should be respected, likely resulting in a test of 107.85, and what has been strong support of late.

Jobless claims as a recession indicator

US economic data in the session ahead really centres on weekly US jobless claims, with the consensus estimate set at 215,000 claims, which would be in-line with the prior week’s print of 218,000 claims. One chart that gets attention here is the 4-week rolling average of jobless claims (white line) vs the 36-month average (or three years). Here, over the past 30 years, when the rolling 4-week average crosses the 3-year average, it can be the precursor for a recession as companies retrench. That isn’t happening yet.

Source: Bloomberg

Crude oil getting slammed

It doesn’t surprise one bit that our flow in WTI and Brent crude has picked up, as a 4% move will generally be of interest to clients. A 2.2m build in the weekly EIA crude inventory data was higher than the estimates for a 713,000-barrel draw, with the build at Cushing taking total US crude stockpiles to 485.5m barrels – the highest level since December 2017. When there is enough uncertainty around global trade, and we see renewed supply concerns, then the bid will come out of the market, and it was all sellers. All eyes on whether the price will break last week’s pin bar candle low of $50.60, which could accelerate the selling into $50. We should consider that the UAE did disclose that OPEC is close to agreeing to an extension of the production cuts, which will be a clear theme when we come to the next OPEC meeting, so there are risks we see headlines designed to support the move lower.

Boris Johnson to lead the Tories in a new general election?

We’ve seen renewed interest to short GBP, with GBPUSD and the GBP crosses reacting to a failed motion from Labour (309 to 298), which had it passed would have effectively blocked a ‘no deal’ Brexit. So, ‘no deal’ is still on the table, and this will be quite a useful tool for Boris Johnson in his negotiating tactics with the EU. That assume Boris gets the gig, although that seems elevated given some 80 Tories have publicly backed him.

Campaigning starts tonight, and we should see the likes of Ester McVey, Andrea Leadsom and Mark Harper being eliminated. All roads lead to a general election or second referendum though, so expect higher GBP vols.

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Chris Weston, Head of Research at Pepperstone

EUR/NZD 1.7085-1.7100 is the POC Zone for Bulls

Dear Traders,

The EUR/NZD has been supported above the important level. 1.7055 is the W l3 and historical support pivot..–>

EU Parliamentary elections had no effect on EUR crosses so the focus is on the NZD fundamentals. As the EU trade balance continued to expand positively last week, we did see flash manufacturing continued to contract in Germany, along with its slowing business confidence.  New Zealand has on the other hand seen a contract in Global Dairy Trade Index for the first time this year, but more so, the prices of other main exports such as Lumber has been contacting significantly in the last year, whilst Live Cattle has continued to reduce since Late February.  This is putting pressure on NZD.

Technically, the pair is having a correction in uptrend and 1.7085-1.7100 is the POC zone where we should look for a potential bounce. Targets are 1.7139 and 1.7160. If bulls want to proceed with uptrend momentum, then 1.7055 should hold.

The analysis has been done with the
CAMMACD.MTF template.

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Many green pips,
Nenad Kerkez aka Tarantula FX
Elite CurrenSea

New Zealand Dollar Crumbles as RBNZ Signals Possible Rate Cut

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The New Zealand Dollar tumbled across the board during the early parts of Tuesday morning after the Reserve Bank of New Zealand’s (RBNZ) dovish shift caught markets by surprise.

With the central bank abandoning its long-standing neutral stance on interest rates and signalling a possible cut, the New Zealand Dollar is likely to weaken further. This is already being reflected in the NZDUSD which dropped a staggering 100+ pips in a matter of minutes following the RBNZ’s dovish statement. Focusing on the technical picture, the currency pair is turning bearish on the daily charts with prices trading marginally below 0.6810 higher low as of writing. Sustained weakness below this level will signal further downside with the next key point of interest at 0.6750. Alternatively, if 0.6810 proves to be reliable support, prices have the potential to rebound back towards 0.6850 before resuming the downtrend.

NZDJPY knocks on 75.00’s door 

The NZDJPY collapsed roughly 110 pips following the RBNZ’s dovish shift to trade around 75.00 as of writing. Prices are looking increasingly bearish on the daily charts with a breakdown below 75.00 opening a path towards 74.30. On the other hand, a rebound from 75.00 could send the NZDJPY back to 75.40.

EURNZD pushes above 1.6550 

We see weakness in the New Zealand Dollar pushing the EURNZD higher in the near term. For as long as the New Zealand Dollar continues to weaken, EURNZD bulls will remain in the driving seat moving forward. A solid daily close above the 1.6550 is seen pushing prices higher towards 1.6730.

NZDCAD sinks towards 0.9100 

The NZDCAD is on route to sinking lower if bears are able to secure a solid close below 0.9100. This pair has broken the bullish channel on the daily charts with bears eyeing 0.9100 and lower. A solid daily close below this point will most likely invite a decline towards 0.9000.

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