November 22, HotForex – EURNZD has ebbed back above 1.6700, with the Kiwi declining concomitantly with a fall in stock markets area in Europe and as US futures are also under pressure.
A negative close on China’s equity bourses, where the SSE index finished with a 0.23% loss, was also a bearish cue for the Kiwi given the relative dependency of the New Zealand and Australian economy on China.
Trade warring between the globe’s two biggest economies, coupled with signs of weakening corporate profits and less accommodative liquidity environment have been fueling a bearish sentiment in global equity markets, with valuations looking rich following a near decade long bullish run.
EURNZD Technical Analysis
This backdrop has been negative for the Kiwi currency. EURNZD descended over the last 3 weeks, we see class the pair as remaining in an overall bear trend, which has been unfolding since early October from levels above 1.7900.
Currently the pair is looking for another positive session, retesting 4-day resistance at 1.6764. Support is set at 1.6640. A break and closing above 1.6800 could suggest a bounce up 1.7100- 1.7170 area (the confluence of 50-week SMA, 20-day SMA and 23.6% Fib. level)
However, as mentioned on November 15 post, by taking into consideration the constant declines of the price but also on momentum indicators, the pair remains strongly to the bearish outlook, without reversal signs yet.
EURNZD, H4 and Daily
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