EURNZD has been trending higher, as a rising trend line can be drawn to connect the lows of price on the 4-hour time frame. The pair looks ready to test the support area right now, which might offer a chance to buy on dips.
The 100 SMA is still above the 200 SMA, confirming that further gains are likely and that the pair could climb to the recent highs at 1.6500. Stochastic is pointing up, indicating that buyers are in control at this point, and RSI is giving the oversold signal as well.
However, a return in selling pressure or profit-taking ahead of the event risks from the Eurogroup meetings over the weekend could lead to a sharp selloff. A break below the rising trend line might be an early signal that a reversal or downtrend is set to take place.
EURNZD Fundamental Forecasts
Earlier this week, meetings between Greek government officials and its creditors still failed to come up with a reform plan for the country. This brings Greece closer to a default situation, as it might fail to meet its next batch of payments to the IMF by June 30. The bailout is also set to expire then.
Eurogroup meetings are scheduled over the weekend and German Chancellor Merkel says that this might be their last chance to iron out a deal that could save Greece. However, even the Syriza leadership seems to be breaking down and there are signs of discord within the group.
Meanwhile, New Zealand just released a stronger than expected trade balance figure but the components of the report show glaring weaknesses. Both imports and exports slumped, indicating weaknesses in international demand and domestic spending. The fall in dairy prices was partly to blame for the sharp drop in exports, along with the 22% decline in whole milk powder exports to China.
To contact the reporter of the story: Samuel Rae at firstname.lastname@example.org