21 Jan 2015
NZD/USD faces key support sub 0.7620
FXStreet (Bali) - NZD/USD printed its lowest at 0.7619 in response to a -0.2% NZ CPI in Q4 vs 0% exp, increasing the possibility of the RBNZ removing its explicit tightening bias when they next meet.
Algos and fast money were quick to sell the NZD over 45 pips on the back of the depressed NZ CPI, with stop loss sell orders below 0.7825/30 - as per Jan 5/Dec 9 lows - being triggered. While the inflation data is a clear negative input for the NZD, near term, after a 3-wave impulsive move down off 0.7850+, the pair may enter a period of accumulation just above 0.76, still seen as a 'nut too hard to crack'. Current price stays at 0.7637.
On Tuesday, Fonterra milk auction results were published, "and while the GDT PI and WMP prices increased for the third consecutive auction, total volumes sold were lower again", notes Jim Langlands, Founder at FXCharts.
According to ANZ: "Whilst tightening supply from NZ is helping turn the tide and dairy markets can turn aggressively in either direction, there will also need to be a lift in end demand. We remain concerned about competition from Europe and weaker demand from key global importers, hence our recently downgraded forecast farm-gate price of $4.35/kg MS for the current season."
Algos and fast money were quick to sell the NZD over 45 pips on the back of the depressed NZ CPI, with stop loss sell orders below 0.7825/30 - as per Jan 5/Dec 9 lows - being triggered. While the inflation data is a clear negative input for the NZD, near term, after a 3-wave impulsive move down off 0.7850+, the pair may enter a period of accumulation just above 0.76, still seen as a 'nut too hard to crack'. Current price stays at 0.7637.
On Tuesday, Fonterra milk auction results were published, "and while the GDT PI and WMP prices increased for the third consecutive auction, total volumes sold were lower again", notes Jim Langlands, Founder at FXCharts.
According to ANZ: "Whilst tightening supply from NZ is helping turn the tide and dairy markets can turn aggressively in either direction, there will also need to be a lift in end demand. We remain concerned about competition from Europe and weaker demand from key global importers, hence our recently downgraded forecast farm-gate price of $4.35/kg MS for the current season."