The uptrend continues. It remains stable and today we will try to explore the perspective for the continuation of the trend. A distinctive feature of the NZD/JPY quotes is a certain magnetism of the rates regarding the support line. Nevertheless, the support line confidently maintains its position and does not shift. Investments in commodity assets are still relevant for investors who are waiting for the global economic recovery.
Weak macroeconomic reports published in March did not change the situation. The NZD is still stronger than the yen, largely due to external factors and the optimistic mood of investors. Even the frankly disappointing indicator of the ANZ business confidence index, which in March was 0.0 points against 11.8 a month earlier, did not change the situation: the New Zealand dollar is still in the green zone and is getting more expensive these days.
The external background remains favorable for NZD growth in the long term. We can see support even from China, where recently we observed a stagnation, according to the macroeconomic indicators. This week, the situation has changed and the latest report on the Chinese economy, the trade balance, showed a significant increase in the surplus in February. In particular, the volume of exports increased by 60.6% and imports rose by 22.2%, which is significantly higher than forecasts and data in January.
The yen, in turn, received another negative signal: in addition to weak demand for safe assets in general, the yen was under pressure due to disappointing data on Japan's GDP in the fourth quarter, which was only +2.8%, below forecasts and almost twice lower than in the previous period.
On Friday, the NZD will be able to gain support through the publication of the business activity index, and next week, the report on industrial production in China, in February, will be able to support demand for commodity assets. Industrial production is expected to grow several times-from 7% to 30%. Also, next week, the report on New Zealand's GDP in the 4th quarter is published. Therefore, the next week will also be very volatile for the NZD/JPY. Most of the technical analysis tools indicate the effectiveness of the deals on the trend in the short and medium term. So our choice today are the deals to BUY.
