Daily Forex News and Watchlist: NZD/USD

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NZD/USD has pulled back from its intraweek trend ahead of today’s U.S. session trading!

Will the pair extend its downtrend? Or will we see an upside breakout today?

Before moving on, ICYMI, yesterday’s watchlist looked at GBP/CAD’s triangle support ahead of the BOC’s policy decision. Be sure to check out if it’s still a good play!

And now for the headlines that rocked the markets in the last trading sessions:

Fresh Market Headlines & Economic Data:

ADP U.S. Non-Farm Private Payrolls for November: 103K (125K forecast; 106K previous); the slowest pace of pay increases since September 2021

U.S. Unit Labor Costs for Q3 2023 (revised): -1.2% q/q (-0.8% q/q forecast; 2.6% q/q previous)

BOC kept its overnight rate at 5.00% as expected; “Data and indicators for the fourth quarter suggest the economy is no longer in excess demand”

Canada’s IVEY PMI for November: 54.7 (54.2 forecast, 53.4 previous)

U.S. crude inventories fell by 4.6 mln barrels – EIA

China’s trade surplus widened from $56.5B to $68.4B in November as exports (+0.5% y/y) outpaced imports (-0.6% y/y)

In a statement to Parliament, BOJ Gov. Ueda talked about handling monetary policy possibly getting tougher next year, which fueled speculations of exit from BOJ’s negative interest rate policies

Switzerland’s unemployment rate remained at 2.1% as expected in November

Germany’s industrial production in October: -0.4% m/m (0.1% m/m forecast, -1.3% m/m previous) and marked the fift consecutive monthly decline for the report

Halifax: U.K. house prices in November: 0.5% m/m (0.3% m/m forecast, 1.2% m/m previous); “The resilience is…underpinned by a shortage of properties available, rather than any significant strengthening of buyer demand.”

France’s trade deficit narrowed from 8.9B EUR to 8.6B EUR as exports (1.2% m/m) outpaced imports (0.6% m/m) in October

Italy’s industrial production in October: -0.2% m/m (-0.4% m/m forecast, 0.1% m/m previous)

Price Action News

Overlay of JPY vs. Major Currencies

Overlay of JPY vs. Major Currencies Chart by TradingView

The Japanese yen was king of pips during the Asian and early European session trading after testimonies by BOJ officials fueled speculations that the central bank would exit its easy monetary policies as early as next year.

JPY started gaining momentum following a weak U.S. session trading and just kept gaining on its counterparts when no other market catalyst distracted the markets.

The yen is trading the strongest against USD and CAD and is registering the least gains against AUD and GBP.

Upcoming Potential Catalysts on the Economic Calendar:

Canada’s building permits at 1:30 pm GMT
U.S. initial jobless claims at 1:30 pm GMT
New Zealand’s manufacturing sales at 9:45 pm GMT
Japan’s average cash earnings and household spending at 11:30 pm GMT
Japan’s final GDP reading at 11:50 pm GMT

Use our new Currency Heat Map to quickly see a visual overview of the forex market’s price action! 🔥 🗺️

NZD/USD 15-min Forex

NZD/USD 15-min Forex Chart by TradingView

NZD/USD has pulled back from its new intraweek lows ahead of the U.S. initial jobless claims release!

In case you missed it, the pair has been showing lower highs and lower lows all week thanks to global growth concerns and profit-taking ahead of this week’s U.S. NFP reports.

NZD/USD found support at the S1 (.6120) Pivot Point line earlier today and is now trading closer to the .6150 Pivot Point line that’s hanging out near a trend line resistance as well as the 100 and 200 SMAs in the 15-minute time frame.

Will the pair turn lower from the technical resistance level? NZD/USD’s next direction will likely depend on how traders react to today’s U.S. initial jobless claims report. It’s projected to show slightly weaker job prospects, which could either fuel Fed rate cut bets or recession fears.

If today’s U.S. reports and U.S. session market themes focus on the Fed’s rate cut bets, then NZD/USD may bust above its trend line resistance and retest previous areas of interest like the R1 (.6170) Pivot Point line.

But if the markets lean towards taking off their “risky” bets ahead of tomorrow’s U.S. NFP report, or if weak U.S. labor market readings translate to global growth concerns, then NZD/USD may extend its short-term downtrend.

NZD/USD could see selling pressure around the Pivot Point line and see enough bearish momentum to retest its .6120 intraweek lows.

What do you think? Which way will NZD/USD go?

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