Daily Market Report – NZD/USD on the rise? August 14, 2017

NZD/USD Throwback In Play

NZD/USD increased in the early morning and looks determined to climb much higher as the dollar index drops again. Price resumed the Friday’s bullish candle, will jump much higher in the upcoming days if the USDX will approach the 92.55 previous low.

USDX dropped again in the last three days and could move in range on the short term till will recapture more bullish energy to be able to start a broader rebound. Only an accumulation movement will signal a reversal, the greenback needs a bullish spark from the US economy these days, otherwise will drop further.

The increased on the positive economic data, the New Zealand Retail Sales rose by 2.0% in Q2, beating the 1.6% growth in Q1, while the Core Retail Sales by 2.1%, more compared to the 1.5% in the previous reporting period.

Price increased after the false breakdown below the confluence formed between the 38.2% retracement level with the fourth warning line (wl4) of the former ascending pitchfork. A retest of the wl4 will confirm a further increase towards the 23.6% retracement level.

Only a failure to climb above the mentioned static resistance will send the rate down again on the short term. I’ve said in the last weeks that the perspective will remain bullish as long as the rate is located above the warning line (wl4), so only a valid breakdown will confirm a larger drop in the upcoming weeks.

AUD/USD Struggling To Rebound

AUD/USD rebounded and tries to jump much higher after the false breakdown below the median line (ML) of the major ascending pitchfork. Could climb higher because has failed to close right on the ML, this scenario will happen only if the USDX will slide further on the short term.

Aussie increased even if the Chinese data have disappointed, the Industrial Production increased by 6.4%, less compared to the 7.1% estimate and versus the 7.6% growth in the former reading period, the Fixed Asset Investment increased only by 8.3% in July, less compared to the 8.6% estimate and versus the 8.6% in June. The Retail Sales rose by 10.4%, less compared to the 10.9% estimate and versus the 11.0% in the previous reading period.

AUD/USD found resistance at the median line of the minor descending pitchfork, now is pressuring the median line (ml) of the minor ascending pitchfork. A valid breakout above the mentioned levels will confirm a further increase.

GOLD Upside Paused

Gold dropped in the morning, even if the Kiwi and Aussie increased versus the greenback. Could come back to retest the broken 38.2% retracement level before will climb much higher on the daily chart. Maybe will consolidate above the static support (resistance turned into support) because needs to recapture more directional energy.

By Olimpiu Tuns

Market Analyst

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