GBP/NZD – Looking To Break Out Of 3-Week Range

#OPINIONLEADER# #Signal#

 AUG 26, 2021

• No mentioning of QE tapering from BoE
• Hawkish RBNZ presents selling opportunities of GBP/NZD

Chart 1: GBP/NZD D1 chart

GBP/NZD has been trading within a 400pips range coming close to three months. Multiple attempts have been made to break above the 2.00 handle but to no avail. Turning our focus to the central banks, the Bank of England (BoE) has revised their economic projections positively during the recent monetary policy meeting. Despite so, the central bank did not mention anything on quantitative easing (QE) tapering. On the other hand, the Reserve Bank of New Zealand (RBNZ) has already ended its QE programme and was even looking at a 0.50% hike in interest rate during the recent meeting, leading to the strengthening of NZD against the GBP.

Fundamentally speaking, we are looking at a stronger NZD than the GBP. Technically speaking, our indicators are showing signs of downward momentum of GBP/NZD. If GBP/NZD breaks below the 1.96 handle, look for selling opportunities.

Trade Setup for GBP/NZD (D1)

Sell Stop at 1.9560

Upcoming major news that may impact price movement of GBP/NZD

27-29 August – Jackson Hole Symposium (GMT+8)

31 August – ANZ Business Confidence data release at 0900 (GMT+8)