New Zealand Institute of Economic Research (NZIER) Survey of Business Opinion was released earlier today.
Data showed business confidence dropped in the first quarter of 2016, with a net 1% of businesses expecting a deterioration in the economy in the next six months.
Short term drivers, such as NZ-US interest rate spreads and commodity prices have been pointing downside for the pair. Technicals on confirm downside for the pair.
Price action has broken below 10-DMA at 0.6797. is biased south, Stochs have rolled over from overbought zone and the line is on the verge of a crossover on signal line.
Immediate resistance is seen at 0.6797 (10-DMA) ahead of 0.68 handle. While supports are located at 0.6720 (Mar 22nd lows) and then 0.6680 (Dec 17th lows).
Broader market sentiment along with upcoming US data and the Fonterra’s dairy auction results will provide fresh impetus to the pair.
Recommendation: Good to sell rallies around 0.6780/90, SL: 0.6840, TP: 0.6720/0.67/0.6680