Time Zone: GMT +2
Time Frame: 4 Hours (H4)
Fundamental Analysis
The EURNZD currency pair, reflecting the Euro (EUR) against the New Zealand Dollar (NZD), is influenced by contrasting central bank policies and economic developments. For the Euro, traders await ECB President Christine Lagarde’s upcoming speech, which may provide hints about inflation handling and potential policy adjustments. On the NZD side, cautious optimism prevails due to New Zealand’s steady economic performance, although the RBNZ remains wary of external global risks. Combined, these factors keep EUR/NZD in a sensitive position, with market participants awaiting new fundamental drivers to determine the pair’s direction.
Price Action
EURNZD shows short-term bullish momentum, with the last four candles indicating an upward movement within a broader bearish trend. The pair is trading between the 0% and 23.6% Fibonacci retracement levels, with the latter acting as a resistance zone. A breakout above this level could extend the recovery, while a rejection may lead to renewed bearish pressure toward support levels.
Key Technical Indicators
Ichimoku Cloud: The price remains below the Ichimoku Cloud, confirming the overall bearish sentiment. However, the narrowing Tenkan-sen (red line) and Kijun-sen (blue line) suggest growing bullish momentum in the short term. The cloud itself acts as a strong resistance above the current price levels.
MACD: The MACD is showing signs of a bullish crossover as the MACD line approaches the signal line, with a shrinking bearish histogram. This indicates weakening downward momentum, signaling a potential shift toward bullish sentiment.
Stochastic Oscillator: The Stochastic Oscillator, now exiting oversold territory near 31, signals potential for further upward movement. However, traders should watch for a slowdown as it approaches neutral or overbought levels.
Parabolic SAR: The Parabolic SAR dots are currently positioned above the candles, indicating bearish momentum in the broader trend. This aligns with the overall bearish sentiment, signaling potential resistance to further upside unless a breakout occurs.
Support and Resistance Levels
Support: Immediate support is at 1.7935, the 0% Fibonacci retracement level, which has been a strong barrier against further downside.
Resistance: Key resistance is at 1.8025, the 23.6% Fibonacci retracement level, where recent bullish attempts have faced rejection.
Conclusion and Consideration
EURNZD is displaying short-term bullish momentum, but the broader bearish trend remains intact. A sustained break above the 23.6% Fibonacci retracement level would strengthen the case for a continued bullish recovery toward 1.8100. Conversely, a failure to maintain upward momentum could lead to a drop back to 1.7935 or lower. Traders should monitor key technical levels and upcoming fundamental events, particularly speeches from ECB officials, for directional cues.
Disclaimer: The analysis provided for EUR/NZD is for informational purposes only and does not constitute investment advice. Traders are encouraged to perform their own analysis and research before making any trading decisions on EURNZD. Market conditions can change quickly, so staying informed with the latest data is essential.
