At the start of the week, New Zealand Dollar jumped after information that Adrian Orr, the president of the NZ Super Fund will become the new president of Reserve Bank of New Zealand. This name does not tell us much, but it suffices to add that Orr has been employed in the central bank twice in his career and that domestic monetary policy is his domain. Although it is not yet possible to say a lot about the new chairperson attitude (hawkish-dovish), his choice removes from NZD the risk that the government could appoint a less predictable candidate more conducive to forced economic policy (or more dovish).
Currently, the NZD value exaggerated the political risk premium and in the short term, the NZD looks the most attractive among the commodity currencies. The global investors still expect the NZ economy to grow at a modest underlying pace, beneath the quarterly volatility in GDP. The September quarter is shaping up to be the weak spot for the year, but recent activity data points to a strong start to the December quarter. There are some challenges to the outlook for next year, but the economy seems to be coming from a stronger starting point than financial markets and business surveys are giving it credit for.
Let's now take a look at the NZD/USD technical picture in the H4 time frame. The market is still trading sideways in a narrow zone between the levels of 0.6779 - 0.6970. At the present, the price is testing the golden trend line dynamic resistance at the level of 0.6910 as it tries to bounce from the oversold levels.
