Global macro overview for 11/11/2016:
The Reserve Bank of New Zealand (RBNZ) cut the official cash rate from 2.0% to 1.75% yesterday, just as expected. The main reason for the cut were uncertainties about the global outlook. At the RBNZ press conference, Governor Graeme Wheeler said: "political uncertainty remains heightened and market volatility is elevated". Moreover, he added that "numerous uncertainties remain, particularly in respect of the international outlook, and policy may need to adjust accordingly". In conclusion, a very cautious rate cut amid the global uncertainties, but the RBNZ will have to wait and see whether the inflation expectations will meet the RBNZ target in the near future, before cutting the interest rate again.
Let's now take a look at the NZD/USD technical picture at the daily time frame. Since the beginning of the year, the market keeps making higher highs and higher lows, but it looks like the uptrend is starting to show signs of weakness. The golden trend line is still not violated, but after the US presidential elections the price just felt below the 55 and 100 DMA. The next support is seen at the level of 0.7105 and the next resistnace is seen at the level of 0.7267.
