EUR/NZD Bearish Trend Expected After Double Top Rejection
EUR/NZD is expected to enter a bearish trend after rejecting and forming a double top at the 1.80200 level. With the rate cut expected today, this bearish move could drop to 1.78520 without much resistance. Keep an eye on the RSI overbought/oversold zones for potential corrections along the way.
Comment
𝗘𝗖𝗕 𝗥𝗮𝘁𝗲 𝗖𝘂𝘁 & 𝗘𝗰𝗼𝗻𝗼𝗺𝗶𝗰 𝗢𝘂𝘁𝗹𝗼𝗼𝗸
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(𝘐𝘯𝘥𝘪𝘢𝘯 𝘚𝘵𝘢𝘥𝘦𝘳𝘥 𝘛𝘪𝘮𝘦 (𝘐𝘚𝘛))/ 𝘜𝘛𝘊 +5.30
𝟭. 𝗘𝗖𝗕 𝗜𝗻𝘁𝗲𝗿𝗲𝘀𝘁 𝗥𝗮𝘁𝗲 𝗗𝗲𝗰𝗶𝘀𝗶𝗼𝗻
Time (IST): 5:45 PM (Tentative)
Data: Expected 25 basis point rate cut (from 4.00% to 3.75% for the main refinancing rate).
Effect on Forex: A rate cut typically weakens the euro as it makes EUR-denominated assets less attractive to investors. This could lead to downward pressure on EUR/USD, EUR/GBP, and EUR/JPY pairs.
Impact on EUR pairs: Negative for the euro, causing possible depreciation
𝟮. 𝗘𝗖𝗕 𝗣𝗿𝗲𝘀𝘀 𝗖𝗼𝗻𝗳𝗲𝗿𝗲𝗻𝗰𝗲
Time (IST): 6:15 PM (Tentative)
Data: President Christine Lagarde’s comments on future monetary policy, inflation outlook, and economic growth.
Effect on Forex: If Lagarde signals a dovish stance (i.e., more rate cuts or a slower path to rate hikes), it could further weaken the euro. Conversely, hawkish signals may offer some support to the EUR.
Impact on EUR pairs: Potential negative if dovish; positive if hawkish.
Comment
=== 𝗥𝗲𝘀𝘂𝗹𝘁 ===
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Today's ECB Interest Rate Decision resulted in a 25 basis point cut, bringing the main refinancing rate to 4.25%, the marginal lending rate to 4.50%, and the deposit rate to 3.75%(
European Central Bank
. This marks the first rate cut since 2016 for some rates, following a period of aggressive rate hikes aimed at controlling inflation in the Eurozone.
Impact on EUR and Forex Pairs:
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-EUR/USD: The rate cut could weaken the euro as lower rates make EUR-denominated assets less attractive to investors, potentially causing the pair to decline.
- EUR/NZD: Similar to EUR/USD, this rate cut may cause a drop in EUR/NZD, as a lower euro makes it less competitive against currencies like the New Zealand dollar, which may remain relatively strong.
𝗢𝘃𝗲𝗿𝗮𝗹𝗹, 𝘁𝗵𝗲 𝗿𝗮𝘁𝗲 𝗰𝘂𝘁 𝗶𝘀 𝘃𝗶𝗲𝘄𝗲𝗱 𝗮𝘀 𝗻𝗲𝗴𝗮𝘁𝗶𝘃𝗲 𝗳𝗼𝗿 𝘁𝗵𝗲 𝗲𝘂𝗿𝗼 𝗮𝗰𝗿𝗼𝘀𝘀 𝗺𝗼𝘀𝘁 𝗰𝘂𝗿𝗿𝗲𝗻𝗰𝘆 𝗽𝗮𝗶𝗿𝘀, 𝗲𝘀𝗽𝗲𝗰𝗶𝗮𝗹𝗹𝘆 𝗶𝗳 𝘁𝗵𝗲 𝗘𝗖𝗕 𝗵𝗶𝗻𝘁𝘀 𝗮𝘁 𝗳𝘂𝗿𝘁𝗵𝗲𝗿 𝗰𝘂𝘁𝘀 𝗶𝗻 𝘁𝗵𝗲 𝗳𝘂𝘁𝘂𝗿𝗲
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