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The Winning Strategy during Asian Session – NZD/USD and NZD/CAD – Short

Later today, at 04:00, we expect China data on industrial production, retail sales and unemployment. Investors will focus their attention mainly on industrial production and retail sales. It is expected to remain at 6.0%, and given the long-term trend you can follow on the chart below, I do not expect surprises in the upward direction.

China Industrial Production

Rather, it is likely that the tariffs against China will also reflect on the real values ​​of the economic indicators. The likelihood of worse data is now confirmed by weaker data coming from the economic indicators posted at a higher frequency.

As far as retail sales are concerned, they are expected to remain at 8.8% or down to 8.7%. And here the trend is to decrease, and by adding the bad foundation around the war, I can not rule out a sharper decrease in the indicator.

China retail sales

Where to look for profits?

The short-term upward adjustment of the NZD gives good prerequisites for shortening during the Asian session. Best Short Positioning Levels, given the expectations of NZD/USD and NZD/CAD pairs.

NZD/USD – H4 (Main Chart): The price is in a medium-term downward trend and the direct dependence of New Zealand on China has a very negative impact on kiwi. In addition to a bad NZD picture, the US dollar has seen a strong upward momentum in the past few weeks. The price is located in the resistance zone formed by the main horizon and 23.6% Fibonacci correction of the main trend. Price Action – The price tested the resistance zone, after which it recorded a strong downward momentum in favor of the USD. The price response clearly shows that bears are the strongest in the market. 50 and 200SMA remain a bearish position – the downward trend remains in place. DeMarker is in overpriced area and points down – likely turnaround and end of corrective movement

NZD/CAD – H4:

Varchev Finance - NZD/CAD short term expectations

And for this currency pair, the price is in the zone of key short-term resistance formed from the previous bottom and 23.6% Fibonacci correction of the main trend. The strong Price Action generated over the past eight hours clearly shows that vendors take the lead. From a fundamental standpoint, NZD will remain under pressure while China and the US do not come up with a commercial sport decision, while CAD is backed by investors who have accumulated positive moods around the NAFTA talks. . 50 and 200SMA remain a bearish position – the downward trend remains in place. DeMarker is in a neutral zone and does not signal a decrease, suggesting that short-term upward pulses are possible.


 Trader Petar Milanov


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