• EUR/NZD strengthened on Monday as risk appetite picked up while investors awaited a ECB policy meeting later this week.
• Money markets are pricing in 130 basis points (bps) of ECB rate increases by year-end, including a 30% chance of an additional 25 bps move beyond the fully priced 25 bps in July.
• EUR/ NZD gains toward 1.6472. A break and daily close above 1.6581 (23.6%fib) will accelerate further gains.
• Technical signals show the pair could gain more ground in the short-term as RSI is at 52 bullish, daily momentum studies 5, 9 and 11 DMAs are trending up.
• Immediate resistance is located at 1.6581 (23.6%fib, any close above will push the pair towards 1.6724 (Higher BB).
• Strong support is seen at 1.6373 (38.2%fib) and break below could take the pair towards 1.6259(50DMA ).
Recommendation: Good to buy around 1.6460, with stop loss of 1.6400 and target price of 1.6530
