NZDUSD – New Zealand Dollar Under Heavy Selling Pressure Vs Dollar21 December, 2016 by Aayush Jindal in Fundamental Analysis, Market Analysis, NZDUSD, Technical Analysis
NZDUSD – New Zealand Dollar Under Heavy Selling Pressure Vs Dollar
- The New Zealand dollar was crushed recently against the US Dollar for a move below 0.7000 and 0.6950.
- There was a critical bullish trend line on the 4-hours chart of NZDUSD, which was broken at 0.7140 to initiate a major downtrend.
- In New Zealand today, the Trade Balance released by the Statistics New Zealand posted a trade deficit of $-705M in Nov 2016.
- In terms of the yearly change, the New Zealand Trade deficit was $-3.18B in Nov 2016.
NZDUSD Technical Analysis
The New Zealand dollar posted heavy losses against the USD during the past few days. The NZDUSD fell continuously and broke the 0.7000 handle. It looks like there can be more declines moving ahead.
The downside move was initiated once the pair broke a critical bullish trend line on the 4-hours chart. The pair traded lower and even broke the 1.236 extension of the last wave from the 0.6971 low to 0.7273 high at 0.6909. It looks like the 1.618 extension of the same wave may be tested in the near term.
On the upside, an initial resistance is at 0.6950. However, the most important hurdle is at 0.7000 where sellers may take a stand if the pair corrects higher in the short term.
New Zealand Trade Balance
Earlier during the Asian session, the Trade Balance, which is a measure of balance amount between import and export in New Zealand was released by the Statistics New Zealand.
The market was aligned for a trade deficit of $-500M in Nov 2016, compared with the previous month. However, the result was lower, as there was a deficit of $-705M in Nov 2016. When we look at the yearly change, the New Zealand Trade deficit $-3.18B.
The report pointed out that “Beef and lamb exports fell in November, as the amount of meat sold dropped heavily compared with last year’s record season. Meat and edible offal exports fell $158 million (31 percent) from November 2015, contributing to a $219 million (5.4 percent) fall in overall exports“.
Overall, the results were not encouraging. The NZDUSD pair may correct higher from the oversold readings, but most likely to remain under a bearish pressure in the near term.