The New Zealand dollar declined against its currency counterparts this week following the drop in risk appetite, and the NZD/JPY may continue to fall lower over the week as investors weigh the outlook for global growth.
[B]Currency Pair:[/B] NZD/JPY
[B]Chart:[/B] 60 Min Charts
[B]Short-Term Bias:[/B] Flat
[B][U]Analysis[/U][/B]
The New Zealand dollar declined against its currency counterparts this week following the drop in risk appetite, and the NZD/JPY may continue to fall lower over the week as investors weigh the outlook for global growth. After reaching a high of 74.59 on 9/8, the kiwi-yen slipped to a low of 44.23 in February due to the rise in risk aversion, but the rebound in market sentiment throughout the first half of the year has helped the pair to retrace the sell-off from October, and the pair may continue to push higher over the near-term as the Reserve Bank of New Zealand expects the $128B economy to expand towards the end of the year. However, the NZD/JPY looks to be forming a double top at 62.90-63.00 (61.8% Fib), and the lack of momentum to retrace the dip from September could lead the pair lower over the remainder of the week to test 59.40-50 (50.0% Fib) for support. Over the next few hours of trading, we may see the pair push higher to retrace the sell-off from the previous and fill-in the gap from the 120-SMA however, as RBNZ Governor Alan Bollard expects the recovery to be ‘slow and drawn out,’ the pair may face increased selling pressures over the near-term as the outlook for growth and inflation remains weak. Be sure to check out other Technical Reports from DailyFX for additional information on the major currency pairs.
[I]To contact the author of this article, please email: <[email protected]>[/I]
[B][I][I] Related Articles:[/I][/I][/B]
[B][I][I]FX Technical Weekly[/I][/I][/B]
[B][I][I]Euro / Dollar 1.4180 Defines Larger Trend[/I][/I][/B]
[I][B]Forex Trading Weekly Forecast - 06.15.09[/B][/I]
[I][B]Euro Rallies Well Capped Ahead of 1.4000; Bearish Structure Intact (Daily Classical)[/B][/I]