Currency Analysis Report 4/28/20 - The Kiwi Consolidating For Now
The Kiwi or the New Zealand dollar takes its cues from global sentiment. While we in the US are starting to open up the economy again, New Zealand is doing the same. According to Johns Hopkins University, New Zealand has less than 25 deaths and less than 1500 people infected by COVID-19. Over the past few days, newly diagnosed infections have been in the single digits. And on Monday, New Zealand reported just one new case.
Last week, New Zealand decided to reduce lockdown conditions from an alert level four to an alert level three, which will allow certain sectors to reopen. For example:
People must work from home if they can. Where that is not possible businesses may re-open but must comply with health and safety requirements around physical distancing and contactless engagement with customers.
Funerals and weddings will be able to go ahead, but limited to 10 people. But they can only be services. No meals, food or receptions can take place.
But by no means does this mean the New Zealand economy will have a “V” shape recover. Like the US, the country will need the help of its central banks.
The New Zealand dollar ran out of the oomph that propelled it higher over the long weekend amid speculation the Reserve Bank may take its official cash rate negative in its efforts to cushion the economic impact of the coronavirus crisis.
"There was heightened talk about the possibility of the RBNZ shifting the cash rate to negative some time this year. That's been the key driver today," said Mike Shirley, a dealer at Kiwibank.
"It will be interesting to see whether the wider market picks up on that theme and pushes the kiwi lower or whether that's all of the juice you can squeeze out of that forecast,"
So where is the Kiwi headed next, lets go to the charts?
Monthly Chart (Curve Time Frame) - monthly supply is 0.6850 and monthly demand is 0.5500.
Weekly Chart (Trend Time Frame) – the trend is up.
Daily Chart (Entry Time Frame) – the chart suggests you can day trade the range, but if you want to swing trade, wait for price to breakout of the range.
This post is my personal opinion. I’m not a financial advisor, this isn't financial advise. Do your own research before making investment decisions.
Posted Using LeoFinance