• EUR/NZD strengthened on Monday as kiwi dollar weakened as investors continued to gauge the potential timing of rate hikes from RBNZ.
• The central bank has recently signalled that interest rates are likely to remain at current levels for some time, pushing back expectations for a near-term hike..
• NZD remained under pressure despite upbeat business activity figures from China, New Zealand’s key trading partner.
• China’s factory activity unexpectedly expanded in December, with the official manufacturing PMI rising to 50.1 from 49.2 in November, according to a National Bureau of Statistics survey released Wednesday.
• Immediate resistance is located at 2.0425(38.2%fib), any close above will push the pair towards 2.0603(Nov 26th high).
• Immediate support is seen at 2.0214(50% fib) and break below could take the pair towards 2.0187(LowerBB).
Recommendation: Good to buy around 2.0400 with stop loss of 2.0350 and target price of 2.0480
