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This pair is sitting right on an area of interest and might be due for a strong bounce.

Any catalysts that could lead to a big move?

But first, here are the headlines that rocked the markets in the last trading sessions:

Fresh Market Headlines & Economic Data:

  • Fed head Powell: Outlook has brightened substantially, but there are risks
  • China suggests mixing COVID-19 vaccines to boost protection rate
  • Japanese producer prices tick higher for the first time in 13 months
  • Japan’s bank lending up from 6.2% to 6.3% 
  • Japan’s preliminary machine tool orders rise by 65% y/y in March
  • Australia drops vaccine targets given “uncertainties” in rollout

Upcoming Potential Catalysts on the Economic Calendar:

  • BOE MPC member Tenreyro’s speech at 2:00 pm GMT
  • BOC Business Outlook survey at 3:30 pm GMT
  • New Zealand NZIER business confidence survey coming up

What to Watch: GBP/NZD

Daily U.S. Session Watchlist: GBP/NZD
GBP/NZD 1-hour Forex Chart

Pound bulls might be waiting to charge now that the U.K. government is starting to ease lockdown restrictions.

This could mean stronger business and consumer activity in the coming months, which could translate to better growth prospects and possibly tighter monetary policy down the line.

Meanwhile, expectations for a cautious RBNZ statement later this week might bring some downside for the Kiwi. After all, bulls might be disappointed to learn that the central bank isn’t rushing to hike interest rates anytime soon.

If that’s the case, GBP/NZD could bounce off this former resistance level that happens to line up with the 61.8% Fibonacci retracement. A return in buying pressure could push the pair back up to the swing high around 1.9827.

Risk sentiment would likely play a role in the higher-yielding Kiwi’s movements, too, especially with Chinese data on the line and traders still keeping close tabs on vaccination rollout efforts.