“¢ A modest USD rebound prompts some fresh selling at higher levels.
“¢ Weaker commodity further dents sentiment and adds to selling bias.
“¢ Traders now eye US macro data/Fed speakers for some fresh Impetus.
The NZD/USD pair extended its steady decline through the mid-European session on Thursday and dropped to fresh session lows, around mid-0.6700s in the last hour.
The pair failed to capitalize on its recent recovery move, rather met with some fresh supply on Thursday, snapping three consecutive days of the winning streak and eroding a major part of the previous session’s goodish up-move to near one-week tops.
With investors looking past the latest FOMC meeting minutes, which reaffirmed the central bank’s dovish policy tilt, the US Dollar managed to rebound from near two-week lows and was seen as one of the key factors prompting some long-unwinding trade.
This coupled with a weaker tone around commodity space, especially oil prices and gold, further dented the already weaker sentiment surrounding commodity-linked currencies – like the Kiwi, and collaborated to the pair’s intraday downslide.
It would now be interesting to see if the pair is able to find any buying interest at lower levels or the current slide marks the resumption of the prior bearish trend as traders now look forward to the US macro releases for some fresh impetus.
Today’s US economic docket features the release of March PPI figures and initial weekly jobless claims data, which followed by scheduled speeches by several FOMC officials might further contribute towards producing some meaningful trading opportunities.
Technical levels to watch
Immediate support is pegged near the 0.6725-20 region, below which the pair is likely to break through the 0.6700 handle and aim towards testing its next major support near mid-0.6600s. On the flip side, the 0.6765-70 region now seems to act as an immediate resistance, which if cleared might help the pair to aim towards reclaiming the 0.6800 round figure mark.
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