Looking at the chart on the weekly time frame, we notice that the EUR/NZD pair is still in a strong bearish trend even after a decline of 1.63000. It is currently at 1.66000 but still below the moving averages of MA20 and EMA20. By setting the Fibonacci retracement level, we see that the pair is testing 61.8% level at 1.66000. The break above takes us first to the MA200 and EMA200 at 1.70000, while the above Fibonacci target at 50.0% at 1.72200. By reducing global risk, the New Zealand dollar is in a much better position against the Euro.
We see the EUR/NZD pair moving in a descending channel on the daily time frame, testing currently moving averages MA20, EMA20. A stronger break pushes us to the MA50 at 1.67500 to the channel’s top edge, where we need another break to continue to higher levels on the chart closer to 1.70000. If we don’t see that scenario and the MA20 and EMA20 become resistant again, we go down to 1.65000 psychological level for this pair and even potentially testing the previous low again.
On the four-hour time frame, we see how the EUR/NZD pair moves following the moving averages MA20, EMA50, and that above, and we have a stronger resistance to MA200 and EMA200. Based on this, we can again expect the EUR/NZD pair to test the MA200 and EMA200 at 1.67000. And if the euro starts to lose strength again and goes below MA20 and EMA20, we go down to test the 1.65000 zones.
From the economic news for this currency, we can single out the following: Consumer price inflation in Germany accelerated in February, as originally estimated, the latest Destatis figures showed on Friday. According to the current estimate, the consumer price index rose 1.3 percent year-on-year after rising 1.0 percent in January. Prices rose for the second month in a row.
Compared to the previous month, the CPI rose 0.7 percent in February after an increase of 0.8 percent in January. This also coincided with the initial assessment. According to the reading, inflation based on the EU HICP measure was stable in February at 1.6 percent. New Zealand’s manufacturing sector continued to expand in February, albeit at a slower pace.
BusinessNZ’s latest survey on Friday showed a production performance index of 53.4. That’s less than the revised version of 58.0 in January (originally 57.5), although it remains above the 50-point burst or crash line that separates the spread from the contraction. “Even though PMI is still expanding, the share of those who point out negative comments was 54 percent, compared to 46 percent in January,” said Catherine Beard, executive director of BusinessNZ for production. Given the second recent partial lock, it remains to be seen what impact this will have on the sector over the next few months.
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