Forex Market Analysis

Rate Statement for GB & New Zealand, and US CPI


News Commentary

The Federal Reserve will probably adhere to its gradual pace of rate hikes after a disappointing CPI reading. The inflation indicator CPI (MoM)  was 0.2%, unlike the forecast 0.3%.


As expected, the Bank of England kept interest rates on hold and said that any upcoming rate hikes are expected to be progressive and limited.

The BoE’s Monetary Policy Committee voted to leave interest rates on hold at 0.5% and also left its asset-purchase program unchanged. This was widely anticipated after softer first quarter growth rising by just 0.1%

“The recent weakness in data for the first quarter had been consistent with a temporary soft patch, with few implications for the outlook for the UK economy… There was value in seeing how the data unfolded over the coming months, to discern whether the softness in Q1 might persist”  the meeting minutes said.

On his first meeting as governor of the Reserve bank of New Zealand, Orr sent a dovish statement although he left the cash rate at 1.75%

According to first quarter growth with 0.7% from the previous 0.8%, Orr seemed to remove the tightening bias, with a neutral stance speech saying that the next move in the interest rate could be up or down.



The price is located at a very strong short-selling area, rebounding from the descending trend line from the high of 2018, besides the broken uptrend line from the low of 2011. Also reaching the top edge of the upward channel along with forming an AB=CD harmonic pattern with divergence on RSI. We will wait for a break beneath the upward channel to go short to our target 108.1 then 104.8.



On the daily chart, we can see that the price bounced from the support area 80.35-81.2. A well-noticed head & shoulders reversal pattern is shaped. The price’s at the second shoulder and bouncing off the lower trend line as shown.

Followed by oversold on RSI, the price is expected to get back up again to the resistance area of 84-84.35.




On the daily chart, the price bounced from the support zone 1.0475-1.0545. Breaking also a lower trend line followed by a break of the descending channel. The price is now moving sideways between levels 1.066 & 1.073.

The harmonic pattern improves the chance of a bullish continuation. Following a break of 1.073 and approaching 1.084, it is assumed to continue its bullish move to 1.102




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