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Forex - NZD/USD weekly outlook: May 26 - 30

Published 05/25/2014, 09:00 AM
NZD/USD ends the week with a loss of 0.93%
- - The New Zealand dollar fell to a three-week low against its U.S. counterpart on Friday, amid indications that the U.S. economy is shaking off the effect of a weather-related slowdown over the winter.

NZD/USD hit 0.8531 on Friday, the pair’s lowest since April 29, before subsequently consolidating at 0.8553 by close of trade, down 0.15% for the day and 0.93% lower for the week.

The pair is likely to find support at 0.8531, the low from May 23 and resistance at 0.8587, the high from May 22.

The Commerce Department reported Friday that sales of new homes rose by a larger-than-expected 6.4% to 433,000 in April, after two months of decline.

Analysts had been expecting a figure of 425,000. March's number was revised up from 384,000 to 407,000.

The upbeat data underlined the view that the U.S. economy was regaining traction after being slowed by unusually cold temperatures during the winter months.

Data from the Commodities Futures Trading Commission released Friday showed that speculators decreased their bullish bets on the New Zealand dollar in the week ending May 20.

Net longs totaled 17,594 contracts as of last week, compared to net longs of 19,340 contracts in the previous week.

In the week ahead, U.S. markets will remain closed on Monday for the Memorial Day holiday. Revised data on U.S. first quarter growth and reports on U.S. consumer confidence will be in focus.

Ahead of the coming week, has compiled a list of these and other significant events likely to affect the markets.

Monday, May 26

New Zealand is to publish data on the trade balance, the difference in value between imports and exports.

Markets in the U.S. will remain closed for the Memorial Day holiday.

Tuesday, May 27

The U.S. is to produce data on durable goods orders, house price inflation and consumer confidence.

Wednesday, May 28

New Zealand is to release private sector data on business confidence.

Thursday, May 29

The U.S. is to release revised data on first quarter GDP, as well as the weekly government report on initial jobless claims and data on pending home sales.

Friday, May 30

New Zealand is to release data on building consents.

The U.S. is to round up the week with a report on personal income and expenditure and revised data from the University of Michigan on consumer sentiment.

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