Yesterday, it was President Trump’s speech at State of the Union but Fed official’s comments were the market drivers. With March fed hike talk, the fed fund rate tracker has shifted the probability of a March rate hike to 75%. That is up from 25% a couple of weeks ago. This tightening will surely have some implications. Dow Jones is currently trading at all time high and with SnapChat going to an IPO with a valuation of about $24B at an average $17 per share. It’s an expensive share but this coupled with Fed rate hike will spur some USD demand. There was nothing concrete investors could draw from Trump’s Speech. He kept talking about his vision of American workers, immigration controls and tax reforms. Tax reforms so far remain contentious and any form of reform undertaken should boost the greenback. Aussie on the other hand is firm though its bullish run is waning. Bullish sentiments toned down a little bit but corporate demand coz of dividend buying is expected. Economic expansion was beyond expectations at 1.1% with Chinese PMI trending higher and supporting the AUD. Fundamentally, things are good for the greenback but there are short positions building up for AUD and NZD. What out for Euro zone CPI in the next hour. Projections are higher and this should drive the markets higher.
Technically, shorting the NZD sounds like a good deal. I would like to go long on EURNZD and aim a 1:3 risk reward ratio. Flexibility is key and dependant on recent developments-both technically and fundamentally. There is a clear break above resistance trend line in the daily chart with both stochastics and OBV pointing upwards. More Euro longs should support the move up and this will mean trading as the trend dictates.
Entry in the 1HR chart or 30 min chart when they are in sync with the daily chart-longer timeframe. This will turn out as follows:
Buy: 1.4820
Stop Loss: 1.4750
Take Profit: 1.4950-Fibonacci 161.8 extension line.

NB: Sorry guys, when I wanted to post this trade earlier but there was some logging problems.i don’t know if you experienced the same. You might have missed the trade but it looks like the second phase of the trade just begun.Buy the pull backs especially if there are oversold stochastics at any of the Fibonacci levels.

EURNZD 30 Min chart-02.03.2017

Source: Dalmas Ngetich

EURNZD Daily chart-02.03.2017

Source: Dalmas Ngetich

2 thoughts on “EURNZD DAILY ANALYSIS FOR 02.03.2017”

  1. Maryna says:

    Hey Dalmas, so glad to see that you noted that it was the Fed comments that moved the market yesterday and not Donald Trump as nowadays the market and traders have become obsessed with Donald Trump and giving him credit for market moves which is not the case!

  2. Dalmas Ngetich - FOREX.TODAY says:

    Yes indeed. Donald is turning out to be so erratic. Yesterday’s market moves can be attributed solely to Fed’s official. comments. Kaplan spoke and he his somehow hawkish. governor wheeler spoke and did you notice that kiwi spike beginning of his speech? Crazy. Anway, hope you caught this move earlier.

Leave a Reply

This site uses Akismet to reduce spam. Learn how your comment data is processed.