Source: PaxForex Premium Analytics Portal, Fundamental Insight
The New Zealand Performance of Services Index for August came in at 47.1, and the New Zealand Performance of Composite Index was at 46.8. Forex traders can compare this to the New Zealand Performance of Services Index for July, reported at 47.8, and the New Zealand Performance of Composite Index at 47.5.
New Zealand RBNZ Offshore Holdings for August came in at 58.6%. Forex traders can compare this to New Zealand RBNZ Offshore Holdings for July, reported at 58.3%.
The Singapore Trade Balance for August came in at S$3.584B. Economists predicted a reading of S$5.787B. Forex traders can compare this to the Singapore Balance for July, reported at S$6.509B. Non-oil exports for August plunged by 3.8% monthly and 20.1% annualized. Economists predicted a rise of 5.5% and a drop of 15.8%. Forex traders can compare this to Non-oil Exports for July, which collapsed by 3.5% monthly and 20.3% annualized.
This trading week will start quietly, but the drop in Singapore non-oil exports confirms the ongoing global economic slowdown. Traders await the US Fed interest rates announcement, where markets expect no change from the current rate of 5.50%. Inflation began to increase in August, with the CPI and PPI clocking in above estimates, but one outlier does not warrant a policy change. It can also take six to nine months for interest rates to filter through the economy, and the US central bank should have reason to implement a hawkish pause before another 25 basis point hike before year-end unless inflation recedes.
The forecast for the NZD/SGD remains cautiously bullish as this currency pair attempts a breakout above its horizontal support area. The Kijun-sen and the Tenkan-sen flatlined after narrowing their gap, and volatility could rise this week, but the conditions for a bullish crossover exist. After the Senkou Span B ended its down drift, the Ichimoku Kinko Hyo Cloud could begin to narrow in another sign of rising bullish momentum, but the Senkou Span A extends its contraction. Traders should monitor the CCI, which formed a positive divergence in extreme oversold territory before completing a double breakout, above -100 and above zero. This technical indicator began to reverse in positive territory but has plenty of upside potential with rising bullish pressures, which could lead price action higher. Can bulls overpower bears and regain control over the NZD/SGD to push this currency pair into its horizontal resistance area? Subscribe to the PaxForex Daily Fundamental Analysis and earn over 5,000 pips per month.
Should price action for the NZD/SGD remain inside the or breakout above 0.8015 to 0.8080 zone, PaxForex recommends the following trade set-up:
- Timeframe: D1
- Recommendation: Long Position
- Entry Level: Long Position @ 0.8050
- Take Profit Zone: 0.8225 – 0.8275
- Stop Loss Level: 0.7975
Should price action for the NZD/SGD breakdown below 0.8015, PaxForex recommends the following trade set-up:
- Timeframe: D1
- Recommendation: Short Position
- Entry Level: Short Position @ 0.7975
- Take Profit Zone: 0.7885 – 0.7915
- Stop Loss Level: 0.8015
Open your PaxForex Trading Account now and add this currency pair to your forex portfolio.