Friday’s trade saw NZD/JPY within the range of 81.17-82.57. The pair closed at 81.54, falling 0.63% on a daily basis, while extending the loss from Thursday. The daily low has been the lowest level since December 14th, when a low of 80.90 was registered. In weekly terms, NZD/JPY added 0.34% during the current week, following a 2.24% slump in the week ended on December 13th. The latter has been the sharpest weekly drop since the week ended on September 6th, when the pair lost 4.94%. NZD/JPY has appreciated 0.60% so far during the current month.
On Monday (December 21st) NZD/JPY trading may be influenced by the releases listed below.
Fundamentals
New Zealand
Consumer survey by Westpac
At 22:00 GMT on Sunday Westpac New Zealand is to report on consumer confidence in the country regarding the final quarter of the year. In Q3 the corresponding gauge of confidence was reported to have fallen to 106.0 from 113.0 in the second quarter. Q3 level of confidence has been the lowest since the third quarter of 2012. Lower readings of the index would suggest a lesser willingness to spend and a certain negative implication for economic growth, respectively. Therefore, lower index values would have a limited-to-moderate bearish effect on the kiwi dollar.
Japan
Bank of Japan Monthly Economic Survey
At 5:00 GMT on Monday Bank of Japan is to release its monthly study on economic developments in Japan. Any positive changes presented in this release would usually support demand for the yen and vice versa.
Correlation with Major Pairs
Taking into account the week ended on December 20th and the daily closing levels of the currency pairs involved, we come to the following conclusions in regard to the strength of relationship:
NZD/JPY to NZD/USD (0.7176, or strong)
NZD/JPY to USD/JPY (0.6488, or strong)
NZD/JPY to AUD/USD (0.2651, or weak)
NZD/JPY to GBP/USD (0.1387, or weak)
NZD/JPY to EUR/USD (0.0822, or very weak)
NZD/JPY to USD/CHF (0.0051, or very weak)
NZD/JPY to USD/CAD (-0.4703, or moderate)
1. During the examined period NZD/JPY moved strongly in one and the same direction with NZD/USD and USD/JPY.
2. NZD/JPY moved almost independently compared to EUR/USD and USD/CHF during the week. The correlation between NZD/JPY and USD/CHF was almost non-existent.
3. The correlation between NZD/JPY and AUD/USD, NZD/JPY and GBP/USD was insignificant during the period in question.
Daily and Weekly Pivot Levels
By employing the traditional calculation method, the Monday pivot levels for NZD/JPY are presented as follows:
Central Pivot Point – 81.76
R1 – 82.35
R2 – 83.16
R3 – 83.75
S1 – 80.95
S2 – 80.36
S3 – 79.55
By using the traditional method of calculation again, the weekly pivot levels for NZD/JPY are presented as follows:
Central Pivot Point – 81.88
R1 – 82.83
R2 – 84.12
R3 – 85.07
S1 – 80.59
S2 – 79.64
S3 – 78.35
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