NZD/CAD Forecast Today 15/11: Strong NZD (Chart)
Date
11/15/2024 2:33:11 PM
(MENAFN- Daily Forex)
In my daily analysis of minor currency pairs, the NZD/CAD pair has captured my attention. This is due to a bounce from the large, round, and psychologically significant 0.82 level, an area that has held importance multiple times in the past.
When you look at these two currencies, they are both commodity currencies, but the Canadian dollar is especially sensitive to
crude oil. This is because Canada is a major exporter of crude oil, and as a result a lot of
Forex traders will use this currency as a way to trade the crude oil
market without actually being bothered to do so directly.
When you look at the New Zealand dollar, it is a commodity currency as well, but it is more geared toward soft commodities such as agricultural ones that end up in places like China and Indonesia. In other words, the commodity markets move both of these currencies, but for completely different reasons.
Top Forex Brokers1 Get Started 74% of retail CFD accounts lose money New Zealand is Tied to Asia
While the Canadian economy is tied to crude oil, the quickest way to think about New Zealand is that it is tied to Asia, and whether or not the global economy is humming along strong enough to lift Asia. Currently, it looks like there are some real questions out there, so it's not a huge surprise to see that the New Zealand dollar has been a bit“soft” as of late. However, this is a measure of relative strength between these two currencies, so therefore both can represent softening economies, but the one who is softening less of course is going to come out on top Analysis
The technical analysis for this pair of course is fairly supportive, as the 0.82 level underneath has offered a significant amount of support previously, and it did of course cause the market to bounce during the day on Thursday. The fact that we are forming a bit of a hammer suggests that we could get a little bit of follow through. If we can break above the top of the candlestick for the trading session on Thursday, then we could see this market at least try to get to the 200 Day EMA above, which is just above the 0.83 level.
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