NZDUSD Fundamental Analysis – July 24th 2019

New Zealand reported a better than expected trade surplus for June, but it came on the back of a slump in imports as exports decreased sharply. This is the freshest sign that global trade is contracting. The NZDUSD stabilized after a minor correction over the past three trading sessions. Does this represent a good buying opportunity or will the downtrend extend? Today’s fundamental analysis will take a look at price action in both directions and highlight the best trading set-up for a profitable outcome.

Here is the key factor to keep in mind today for New Zealand Dollar trades:

• New Zealand Trade Balance: The New Zealand Trade Balance for June was reported at NZ$365M monthly and at -NZ$4,937M 12-month year-to-date. Economists predicted a figure of NZ$100M and of -NZ$5,105M. Forex traders can compare this to the New Zealand Trade Balance for May which was reported at NZ$264M monthly and at -NZ$5,492M 12-month year-to-date. Exports for June were reported at NZ$5.01B and Imports were reported at NZ$4.65B. Economists predicted a figure of NZ$5.29B and of NZ$5.20B. Forex traders can compare this to Exports for May which were reported at NZ$5.81B and to Imports which were reported at NZ$5.54B.

US PMI data will complete today’s PMI heavy economic calendar and economists anticipate a minor increase for July. Given the series of disappointing regional reports, the risk for today’s PMI remains to the downside. The US Dollar is facing bearish pressures as the FOMC meeting is approaching where markets expected an interest rates cut to be delivered. The US housing market continues to disappoint, will today’s new home sales follow suit? How will the NZDUSD be impacted? Subscribe to the PaxForex Daily Fundamental Analysis and allow our expert analysts to guide you through the forex market yielding over 500 pips in profits!

Here are the key factors to keep in mind today for US Dollar trades:

• US Markit Manufacturing PMI, Services PMI and Composite PMI: The Preliminary US Markit Manufacturing PMI for July is predicted at 51.0. Forex traders can compare this to the US Markit Manufacturing PMI for June which was reported at 50.6. The Preliminary US Markit Services PMI for July is predicted at 51.8. Forex traders can compare this to the US Markit Services PMI for June which was reported at 51.5. The Preliminary US Markit Composite PMI for July is predicted at 51.8. Forex traders can compare this to the US Markit Composite PMI for June which was reported at 51.5.
• US New Home Sales: US New Home Sales for June are predicted to increase by 5.1% monthly to 658K new homes. Forex traders can compare this to US New Home Sales for May which decreased by 7.8% monthly to 626K new homes.

Should price action for the NZDUSD remain inside the or breakout above the 0.6655 to 0.6725 zone the following trade set-up is recommended:

• Timeframe: D1
• Recommendation: Long Position
• Entry Level: Long Position @ 0.6695
• Take Profit Zone: 0.6915– 0.6970
• Stop Loss Level: 0.6630

Should price action for the NZDUSD breakdown below 0.6655 the following trade set-up is recommended:

• Timeframe: D1
• Recommendation: Short Position
• Entry Level: Short Position @ 0.6630
• Take Profit Zone: 0.6480 – 0.6525
• Stop Loss Level: 0.6655

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