Global macro overview for 21/07/2016:
The much-anticipated Reserve Bank of New Zealand statement has indicated a change in the monetary policy and increased the odds for a rate cut by the RBNZ at the next meeting in August. There was one important line in the statement, saying: "The high exchange rate is adding further pressure to the dairy and manufacturing sectors and, together with weak global inflation, is holding down tradable goods inflation." In conclusion, the policy confirms market expectations and all global investors will now keep an eye on the next RBNZ meeting.
Let's now take a look at the NZD/USD technical picture on the daily time frame. The bears have managed to violate the important support at the level of 0.7052 and now the market is testing this level from below. The price still trades above the 55, 100 and 200 DMA, so the outlook is still bullish. Only a sustained break out below the level of 0.6672 would change the bias to more bearish.
