The U.S. is printing a bunch of top-tier reports today!
How do you think the releases will affect NZD/USD’s short-term uptrend?
Before moving on, ICYMI, yesterday’s watchlist looked at USD/CHF’s range resistance ahead of the U.S. CPI release. 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:
U.S. CPI for August: 0.6% m/m (0.5% m/m forecast; 0.2% m/m previous); Core CPI: 0.3% m/m (0.2% m/m forecast/previous)
U.S. MBA Mortgage Applications: -0.8% w/w vs. -2.9% w/w previous
RICS: U.K. house price gauge hits 14-year low of -68 in August (vs. -56 in July) thanks to elevated mortgage costs and economic uncertainty
Melbourne Institute inflation expectations fell from 4.9% y/y to 4.6% y/y in September
Japan’s final industrial production revised from -2.0% to -1.8% in July
Japan’s core machinery orders dropped by 1.1% m/m (vs. -0.9% expected, 2.7% previous) in July as manufacturers balked at new investments
Australia’s unemployment rate remained at 3.7% in August; Participation rate edged up from 66.9% to 67.0%; Employment gains higher at 64.9K (vs. 25.4K expected, -1.4K previous) but part-time gains (+62.1K) outpaced full-time job increases (+2.8K)
Switzerland’s producer prices fell by 0.2% m/m in August (vs. 0.1% expected, -0.1% previous)
Price Action News
The Australian dollar jumped higher across the board earlier today thanks to Australia’s headline labor market numbers coming in better than expected.
While the unemployment rate remained at 3.7% as expected, a net of 64.9K jobs were added when analysts only saw a 25.4K increase.
Both AUD and NZD soon turned lower, however. There were no direct catalysts to explain the broad moves, but it’s possible that traders focused on the details of Australia’s jobs data. Part-time employment wildly outpaced full-time jobs and the details also showed that average hours dropped for ALL job sectors.
AUD pulled back most of its Asian session gains, revisited its intraday highs during the London session open, and settled closer to its pre-jobs report levels ahead of today’s economic calendar events.
ECB’s monetary policy decision at 12:15 pm GMT (presser at 12:45 pm GMT)
U.S. PPI reports at 12:30 pm GMT
U.S. retail sales reports at 12:30 pm GMT
U.S. initial jobless claims at 12:30 pm GMT
U.S. business inventories at 2:00 pm GMT
NZ BusinessNZ manufacturing index at 10:30 pm GMT
China’s data dump at 2:00 am GMT (Sept 15)
Use our new Currency Heat Map to quickly see a visual overview of the forex market’s price action! 🔥 🗺️
With the U.S. printing its August producer prices and consumer retail activity, you can bet that I’m looking at USD pairs!
I got my eye on NZD/USD, which has been making higher highs and higher lows since finding support from the .5890 levels this week.
As you can see, the pair found resistance at the .5945 levels earlier today and has pulled back to the .5920 area near a trend line, 100 SMA, and 61.8% Fibonacci support zone.
Can NZD/USD extend its gains today?
Softer producer price gains and consumer retail activity would support claims that the Fed is almost done raising its interest rates in the short term.
We could see a risk-friendly environment that could take NZD/USD to its previous highs near .5945 if not new weekly highs.
I wouldn’t discount more USD gains, though.
If we see higher-than-expected U.S. PPI and retail sales, or if today’s catalysts highlight concerns over a high-interest rate environment, then NZD/USD may break its short-term uptrend and trade below its trend line support.
Either way, make sure to look for confirmation candlesticks whether you’re trading a trend continuation or a trend breakout in the next trading sessions!