From yesterday’s data, the number of Americans
claiming for unemployment claims failed more than expected to 268K from last
week’s seasonally adjusted 278K, representing as second week of continuous decline
in the number of citizens claiming benefits. This only signaled that the labor
market is healthy and economy rebounding after declining gains in the first
quarter of the year. Core Durable Goods orders recorded a 0.3% improvement for
the month of April to 0.4% with a demand for transport equipment leading the pack.
What was key however was the fact that spending on business plans especially in
the manufacturing sector-which represents 12% of the economy-continued to
weaken perhaps from the past Dollar surge and decreasing overseas demand in the
manufacturing sector. With this news, we saw the NZD surge and rebounded from
the 0.67 lows and recorded 0.6768 highs.
Let’s see what happened on the charts:
Daily Chart Analysis
In my opinion, there is accumulation happening and
even though the support trend line remains unbroken and formation of long lower
wicks dojis on the support area, any break below this region will validate our
continued short. At the moment, market is just moving sideways with no major
gains and an average daily pip range printout of 65 pips in the past couple of
trading days. Price action is bouncing off from the lower BB and both
stochastics and OBV are still in the oversold region with a formation of a buy
signal in the Asian session, we shall continue therefore to buy at all lows for
4HR Chart Analysis
There has been a clear follow through after that
double bar reversal candle sticks in the support trend line. A strong buy
signal because it was accompanied by a turnaround of both stochastics and OBV
showing that volume and momentum were increasing and more investors were demanding
the kiwi. We shall be watching closely if price action will breach through the
resistance trend line-above 0.6755- drawn from this week’s open and Wednesday’s
high. If it does, our next target of TP will be 0.68.
15 Minute Chart Analysis
The Asian session was oscillating between yesterday’s
high at around 0.6860 and 0.6845, a tight 15 pip range with a clear support
zone at 61.8 Fibonacci level drawn from yesterday’s HiLo. We shall watch for
any retracement back to this level and initiate our buys provided there is a
good buy signal in the European and NY Sessions.
Of concern is the release of Preliminary GDP q/q
at 1230 GMT with projections at 0.8% from 0.5%, watch out for that because
volatility is expected.
Otherwise, have a pipful day and a great weekend.
About The Post
About The Forex Analyst
I have been trading Forex and commodities for the past 3 years. [email protected] for further discussions.