Global macro analysis for 27/07/2016:

The New Zealand Trade Balance data revealed that the trade surplus shrank more than expected in June. Statistics New Zealand said in a report that the trade surplus hit $127M, almost in line with the market expectations of $128M, and it was a sixth consecutive trade surplus. On a yearly basis, New Zealand had a deficit of -$3.3 billion, while in May the year-over-year deficit was -$3.6 billion. In conclusion, this data indicates the New Zealand economy is expanding at a steady pace, but it is facing deflationary pressures: inflation remains low and the RBNZ has made several rate cuts already. To improve the situation, another rate cut is being expected by the end of the year.

Let's now take a look at the GBP/NZD technical picture on the intraday time frame. After an impressive rally from the 1.7700 level up to the 1.904 level, the market entered a corrective cycle and managed to retrace 38% of this rally. Currently, the price is moving inside of the channel (dashed line), but it is below the golden trend line already. The key level for bulls is 50% Fibo at the level of 1.8374, and this level must hold if any new high is made any time soon.