NZD/USD Outrageously OverBought

28 dic 2019

NZD's newfound strength is artificial for the most part. Let's analyze: New Zealand's GDP report showed to be better than expected, but let's put that into perspective. In Q2, their GDP was revised down and you want to convince me that this 0.7% quarter growth is significant. The yearly GDP growth is still on a convincing downtrend. Many Banks still have the RBNZ down as giving a rate cut at the start of the year. Inflation is not where they want it to be. Yes, the trade war is making progress which is a natural provider of currency strength to the NZD. However, this is not enough substance to justify the strength of the current bull run. The ridiculousness is showcased in the RSI(14) which is showing 2-year highs. Expecting a sharp decline at the start of the trading week.


Disclaimer: I am not your financial advisor.