Looking at the two charts – EUR/USD and EUR/NZD – I prefer buying EUR/NZD.
prefer buying EUR/NZD around 1.6490-1.65 for a Target of 1.6770-1.6949 with a stop loss of 1.6318
Amid falling milk prices, the Kiwi appears almost as vulnerable to broad based USD rally as the EUR is. Thus, buying EUR/NZD looks a much safer bet as USD rally due to increased odds of Fed tightening could also trigger losses in the equities, which could keep EUR relatively strong (EUR – a funding currency).
On the charts, EUR/USD appears poised for a break from the 100-pip range of 1.0680-1.0780. I wouldn’t not call it an inverted head and shoulder breakout now!
Meanwhile, EUR/NZD looks on the charts as well. The pair flirted with the 50% fib retracement of the rally seen in 2015 in late October, which was followed by repeated failed attempts to rise above 1.65.
However, now the losses have been restricted around 1.6320 as well, from where the cross bounced off today.
Thus I prefer buying EUR/NZD around 1.6490-1.65 for a Target of 1.6770-1.6949 with a stop loss of 1.6318.