Both of these indicators are closely watched by the Forex market. An initial strengthening of the Greenback was reversed, which is indicated by the long tail on the ten-minute bar on the chart above. Thereafter the exchange rate just meandered while market participants tried to make up their minds about the implications of it all.
Today’s report to watch to indicate developments in the EURUSD pair is the Reuters/Michigan Consumer Sentiment Index.
NZ central bank decision hammers the Kiwi
The decision for the Reserve Bank of New Zealand (RBNZ) regarding core interest rates was finely balanced, but in the event they decided to cut. This made for a torrid time for Kiwi bulls yesterday, who would have opted for a stance that reflected the belief that rates would remain the same.
The chart above shows the gap down on the announcement. This looks like a structural development in Technical Analysis (TA) terms – in other words its reverberations are likely to continue into the future and reinforce the dominant trend in the NZDUSD pair, which is downward, but which had shown indications of changing to an uptrend, or at the very least of putting in a major correction, prior to the announcement.