NZD/USD: neutral above 0.7200 - UOB

Analysts at New Zealand explained that New Zealand's August trade balance kicked off this week’s docket.

Key Quotes:

"The country’s trade deficit widened to the biggest monthly gap since September 2014 as dairy and meat exports slumped in August. The deficit of $1.27bn in August was larger than the deficit of $351mn in July and $1.09b in the same month a year earlier. Exports sank 8.7% to $3.39b from August 2015, outpacing a 3.1% fall in imports to $4.65b. Building permits data for August and ANZ business confidence for September will be released on Friday.

Neutral: Bearish if daily closing below 0.7200. The rapid and sharp drop in NZD last Friday has clearly resulted in a weak undertone. However, we prefer to see a daily closing below 0.7200 before turning bearish (with an immediate target of 0.7135/40). This appears to be a likely scenario unless this pair can move and stay above 0.7275 within these 1 to 2 days."