NZDUSD Poised into Key Chinese Purchasing Managers Data

Technical Analysis

On Thursday 23rd April (at 2.45 a.m. UK time) the market sees the release of the HSBC Flash China Manufacturing PMI. Of the Major currencies, this will likely have a notable impact on both the New Zealand and Australian Dollars (being significant trading partners with the Chinese). With the NZDUSD in a bullish phase, but threatening a correction, we look at the key levels to watch.

NZDUSD Downside Correction Risk, but Bullish Trend

Another erratic consolidation, but the rally and setback again point to a downside correction bias into Thursday after a bearish engulfing pattern Monday and rebound failure Tuesday.

However, the strong rebound last week through the critical recovery high from March at .7697 confirmed the previous Double Bottom for a stronger recovery phase into late April.

For Today:

  • We see a downside bias for .7631 and .7624; break here aims for .7582.
  • But above .7687 opens risk up to .7724 and .7740, which we would look to try to cap.

Short/ Intermediate-term Outlook – Upside Risks:

  • Bigger picture, we see a more positive tone with the bullish threat to .7851.
  • Above here targets .7890 and maybe .7975/77.

What Changes This? Below .7483 eases bull risks; through .7422 signals a neutral tone, only shifting negative below .7391.

Momentum: The 8-day RSI, short-term momentum is rising and has scope to go still higher this week.

2 Hour NZDUSD Chart


Daily NZDUSD Chart


Risk Statement: Trading Foreign Exchange on margin carries a high level of risk and may not be suitable for all investors. The possibility exists that you could lose more than your initial deposit. The high degree of leverage can work against you as well as for you.