© Dukascopy Bank SA
"The RBNZ will have to concede that its own growth forecasts are still too high, which will play a big part in prompting rates to be reduced to 2 percent."
- Capital Economics (based on Bloomberg)
Pair's Outloobk
So far this week the Kiwi has been trading flat with a slight bullish bias. The monthly PP at 0.6375 is expected to act as a ceiling and limit potential gains. The technical indicators in all three relevant time-frames speak in favour of a bearish outlook as well. However, even if NZD/USD follows our forecast and declines, the dip could be shallow because of proximity of the spot to the support trend-line and the lowest point recorded back in the third quarter of 2009.
Traders' Sentiment
SWFX traders remain undecided with respect to the prospects of the pair. There is no significant difference between the numbers of bulls (47%) and bears (53%). Meanwhile, 64% of the commands set 100 pips from the current price are to sell the New Zealand Dollar.
© Dukascopy Bank SA