Sell EURNZD 1.7505 Stop 175.65 Target 172.75 (RISK 0.50%)
EUR: Very weak Eurozone PMI data. Eurozone manufacturing sentiment fell in September to the worst level in nearly seven years. The flash Eurozone manufacturing PMI fell to an 83-month low of 45.6 in September, down from 47.0 in August. German manufacturing PMI fell to 41.4 in September from 43.5, the worst reading in more than a decade. The flash Eurozone services PMI fell to an 8 month low of 52.0 from 53.5 in August, which was below the 53.2 reading expected.
NZD: The New Zealand Dollar is trying to hold onto positive news relating to US-China trade, while on Monday, we heard that President Trump had discussed expanding trade and defence cooperation with New Zealand, in a conversation with PM Ardern. We’ve also seen some profit taking on Kiwi shorts ahead of Wednesday’s anticipated RBNZ decision.
From a technical and trading perspective the EURNZD posted a key day reversal yesterday and a potential double top at the 1.76 level, note the momentum divergence on the daily chart which suggests that we may be entering a phase of consolidation/correction, overnight the EURNZD has printed fresh lows as such I am going to enter short positions on a pullback to test offers at the 1.75 level targeting a move to test bids below 1.73 as per the chart below
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