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.
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.
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:
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