• EUR/NZD surged on Friday as risk-sensitive currencies such as the kiwi weakened following Trump’s threat of higher tariffs on China.
• Trump stated there was no need to meet China’s President Xi Jinping in South Korea in two weeks and added on Truth Social that the U.S. is considering a massive tariff hike on Chinese imports.
• The action could trigger a renewed cycle of retaliatory trade measures that Washington and Beijing had suspended following intensive diplomatic efforts earlier this year.
• Earlier this week, China limited exports of essential rare earth materials and on Friday announced that U.S. ships would incur additional port fees beginning October 14.
• From a technical viewpoint, RSI is strongly bullish at 67, daily momentum studies, 5, 10 and 14 daily MAs all climb.
• Immediate resistance is located at 2.0349 (23.6% fib), any close above will push the pair towards 2.0434(Higher BB).
• Immediate support is seen at 2.0104 (SMA 20) and break below could take the pair towards 2.0045(38.2% fib).
Recommendation: Good to buy on dips around 2.0300 with stop loss of 2.0220 and target price of 2.0390
