NZDUSD WEEKLY FORECAST:::WAVE III LEG EXTENDING ITS BEARISH TARGET SOUTH-EAST OF CHART

FUNDAMENTAL BEAM

The New Zealand dollar enjoyed some early gains but found it hard to hold on to them. The key event in the upcoming week is the rate decision. Will the RBNZ raise its tone regarding a rate hike? Here is an analysis of fundamentals and an updated technical analysis for NZD/USD.
Inflation in New Zealand exceeded expectations in the fourth quarter, with a rise of 0.1%. As this is usually a low inflation season, the figures raise expectations for a rate hike in New Zealand, sooner than later. We will know soon. The Business NZ Manufacturing Index continued showing strength in the economy by scoring 56.4 points, reflecting solid growth.
Updates:

1. Rate decision: Wednesday, 20:00. The Reserve Bank of New Zealand releases its rate decision just one hour after the FOMC statement and is also expected to be relatively hawkish. The stronger than expected inflation number and the active housing market support a hike, while the relatively high exchange rate is likely to limit the scope of the statement. No move is expected now, but the Bank could act in the next meeting.
2. Building Consents: Wednesday, 21:45. After a few months of limited moves, the number of approvals jumped by 11.1% in November. A small drop is likely now for the month of December. The housing sector is currently one of the strongest sectors.
3. Visitor Arrivals: Wednesday, 21:45. Also tourism is an important sector in New Zealand. The number of visitors coming to see the land where Lord of the Rings was filed rose by 2.8% in November, and probably continued rising in December.
4. Trade Balance: Thursday, 21:45. New Zealand’s balance of goods turned positive in November with a surplus of 183 million, for the first time in 6 months. An even wider surplus is expected now. This supports the kiwi.
5. Graeme Wheeler: Thursday, 23:00. Just one day after the rate decision, RBNZ governor Graeme Wheeler will make a public appearance in Christchurch. He will have the opportunity to correct any misconception triggered by the rate statement, should it come. He usually moves the markets.

TECHNICAL BEAM

Quite a dynamic market if i must say. market price continue to plunge and decline on data postings from this two powerful economies. However, we expect the US Dollar to post modest gains against the NewZealand dollar this week as Elliot wave and Fibonacci numbers suggest a stretch bearish towards the target 0.7997- hence completing the wave iii leg.

NOTE: Price predictions produced by FibonacciPrice&PatternTrader may be affected by unforeseen events like hurricane, earth quake, flood and other natural disasters consequently changing price patterns already predicted. Hence we advice strict adherence to money management techniques.

HAPPY TRADING