EUR/NZD Coming Closer To Major Support
Vladimir Ribakov | Feb 05, 2014 07:37AM ET
Today we have an interesting opportunity for the EUR/NZD.
I think the pair is coming closer to a major support level. There is also an up-move trend line, as can be seen in the 4 hour chart shown below. This trend line can produce a bounce for the pair in the short term. So, I think we should be looking for buy opportunities.
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Looking at the hourly chart of the EURNZD, the RSI has bounced from around the 20 level. I think the pair might drop a bit lower from the current levels and trade closer to the trend line at around the 1.6300 level. Once the pair drops a bit lower closer to the support area, makes a stop and creates a bullish continuing divergence on the hourly chart, then we will jump into a buy trade.
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Initial target should be around the 1.6500 area, and final target could be around the 1.6580 level. The stop should be placed below the last low created below the trend line.
Recap Of Yesterday's Trades:
Yesterday, there was no major action in the market, and the pair like the EUR/USD and GBP/USD mostly consolidated in a range. Yesterday, in the European session, the UK construction PMI was released, which jumped from 62.1 to 64.6. The data was encouraging, and as a result lifted the GBP/USD higher. Later, in the NY session, the Investor’s Business Daily IBD/TIPP Economic Optimism Index was released, which missed the expectations, and registered a decline from 45.2 to 44.9. Moreover, in the Asian session, the New Zealand’s employment data was released, which came in line with the expectations.
Fundamental Outlook for the day
Today, a lot of data is scheduled to be released for the Euro zone and the UK, including the services PMI and retail sales data. Later, in the NY session, the US ADP Nonfarm employment change figures and ISM non-manufacturing PMI data will be released. After the release, we can see some moves in the US dollar. Furthermore, in the next Asian session, the Australia’s retail sales data and trade balance figures will be published, which can as a catalyst for the AUD pairs. We need to see whether the Intraday ranging moves can be broken or not. So, trade accordingly friends, and avoid any risky setups.
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