New Zealand Dollar: NZD/USD (NZD=X) volatility could be heightened
In New Zealand, the RBNZ was quite clear last month when it said the next policy change by the central bank is likely to be a rate cut. Furthermore, last week’s CPI data served as proof that the economy is weakening. Therefore, justifying the rate cut.
Thin trading conditions could also be helping to exaggerate the sell-off. The Australian and New Zealand markets were closed on Friday and Monday. And they close again on Wednesday. If the major banks and institutions are still on the sidelines, volatility could be heightened and small orders could drive the markets violently in either direction.
Overall, the bias in prices is: Downwards.
By the way, prices are vulnerable to a correction towards 0.68.
The projected upper bound is: 0.67.
The projected lower bound is: 0.66.
The projected closing price is: 0.66.
A black body occurred (because prices closed lower than they opened).
During the past 10 bars, there have been 3 white candles and 6 black candles for a net of 3 black candles. During the past 50 bars, there have been 24 white candles and 24 black candles.
A spinning top occurred (a spinning top is a candle with a small real body). Spinning tops identify a session in which there is little price action (as defined by the difference between the open and the close). During a rally or near new highs, a spinning top can be a sign that prices are losing momentum and the bulls may be in trouble.
Momentum is a general term used to describe the speed at which prices move over a given time period. Generally, changes in momentum tend to lead to changes in prices. This expert shows the current values of four popular momentum indicators.
One method of interpreting the Stochastic Oscillator is looking for overbought areas (above 80) and oversold areas (below 20). The Stochastic Oscillator is 17.8273. This is an oversold reading. However, a signal is not generated until the Oscillator crosses above 20 The last signal was a buy 11 period(s) ago.
Relative Strength Index (RSI)
The RSI shows overbought (above 70) and oversold (below 30) areas. The current value of the RSI is 31.66. This is not a topping or bottoming area. A buy or sell signal is generated when the RSI moves out of an overbought/oversold area. The last signal was a sell 112 period(s) ago.
Commodity Channel Index (CCI)
The CCI shows overbought (above 100) and oversold (below -100) areas. The current value of the CCI is -135.This is an oversold reading. However, a signal isn’t generated until the indicator crosses above -100. The last signal was a buy 11 period(s) ago.
The Moving Average Convergence/Divergence indicator (MACD) gives signals when it crosses its 9 period signal line. The last signal was a sell 5 period(s) ago.
Rex Takasugi – TD Profile
FOREX NZD= closed down -0.001 at 0.665. Volume was 98% below average (consolidating) and Bollinger Bands were 16% narrower than normal.
Open High Low Close Volume___
0.666 0.666 0.665 0.665 710
Short Term: Oversold
Intermediate Term: Bearish
Long Term: Bearish
Moving Averages: 10-period 50-period 200-period
Close: 0.67 0.68 0.67
Volatility: 6 9 10
Volume: 32,609 42,021 48,616
Short-term traders should pay closer attention to buy/sell arrows while intermediate/long-term traders should place greater emphasis on the Bullish or Bearish trend reflected in the lower ribbon.
FOREX NZD= is currently 1.1% below its 200-period moving average and is in an downward trend. Volatility is extremely low when compared to the average volatility over the last 10 periods. There is a good possibility that there will be an increase in volatility along with sharp price fluctuations in the near future. Our volume indicators reflect volume flowing into and out of NZD= at a relatively equal pace (neutral). Our trend forecasting oscillators are currently bearish on NZD= and have had this outlook for the last 16 periods.
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