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Old 23-03-2017, 12:24
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NZD/USD: the interest rate has not changed
23/03/2017
Overview and Dynamics

As already known, on Wednesday evening, the Reserve Bank of New Zealand saved the key rate unchanged at 1.75%. As RBNZ Governor Graham Wheeler said later, "monetary policy will remain soft for a long time." In New Zealand, property prices are steadily growing, while the growth of inflation and economy in the country, according to the RBNZ, is still insufficient. In general, such a decision of the bank was the expected market participants. The main attention of investors in the dynamics of the NZD / USD pair is now focused on the dynamics of the US dollar, which has significantly surrendered its positions in the foreign exchange market recently.
Nevertheless, today the US dollar can get support. At 12:45 (GMT), the speech of the head of the Federal Reserve, Janet Yellen, begins. If she gives a signal to accelerate the rate of rate hikes in the US, then the dollar's position may strengthen in the foreign exchange market.
Also worth paying attention to today's publication (at 21:45 GMT) of New Zealand's trade balance for February. It is expected that the trade surplus will be NZ $ 160 million (against NZ $ -285 million in January).
The main export item of the country is dairy products and especially dried milk. Against the backdrop of the negative dynamics of prices for milk powder, observed in February, expectations regarding the growth of the surplus balance may not be justified. If the trade balance data is weak, the New Zealand dollar may fall in the foreign exchange market.

Technical analysis
In the course of today's European session, the NZD / USD pair is declining. The pair could not develop an upward movement above the level of 0.7065 (EMA200 on the 4-hour chart).
Indicators OsMA and Stochastics on the 1-hour and 4-hour charts went to the side of sellers, signaling the completion of the upward correction, which began on March 9 from the level of 0.6890 (the lower limit of the descending channel on the 4-hour chart).
The NZD / USD pair also remains below the key resistance level of 0.7085 (EMA200 on the daily chart). Below this level, the negative dynamics of the NZD / USD pair will prevail.
Only in case of consolidation above the level of 0.7085 can long long-term positions in the NZD / USD pair with the growth probability to the levels of 0.7235 (EMA144 on the weekly chart), 0.7310 (EMA200 on the weekly chart) be considered. Below the level of 0.7065, short positions are relevant with targets at support levels of 0.6975 (November lows), 0.6900, 0.6870.
Support levels: 0.7015, 0.6975, 0.6940, 0.6900, 0.6870
Resistance levels: 0.7065, 0.7085, 0.7200, 0.7235, 0.7310, 0.7375

Trading recommendations

Sell in the market. Stop-Loss 0.7055. Take-Profit 0.7015, 0.6975, 0.6940, 0.6900, 0.6870
Buy Stop 0.7055. Stop-Loss 0.7025. Take-Profit 0.7065, 0.7085, 0.7200, 0.7235
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