- NZD/USD broke out of daily trading range in early American session.
- US Dollar Index edges lower ahead of Wall Street’s opening bell.
- Weekly Initial Jobless Claims in US came in higher than expected.
The NZD/USD pair spent the first half of the day in a relatively tight range above 0.7200 but gained traction in the early American session and touched a fresh daily top of 0.7251. As of writing, the pair was up 0.45% on the day at 0.7246.
DXY falls for fifth straight day
The renewed selling pressure surrounding the greenback seems to be helping NZD/USD gather bullish momentum. The US Dollar Index (DXY), which stayed flat around 90.40 during the European trading hours, is currently down 0.1% at 90.32.
The only data from the US showed on Thursday that the weekly Initial Jobless Claims declined to 793,000 last week from 812,000. However, this reading came in worse than the market expectation of 757,000.
Meanwhile, the market mood remains upbeat and Wall Street’s main indexes remain on track to start the day in the positive territory with the S&P 500 Futures rising more than 0.3% ahead of the opening bell. Even if US stocks push higher after the opening bell, the more-than-1% increase seen in the 10-year US Treasury bond yield could help the USD limit its losses and make it tough for NZD/USD to extend its rally in the second half of the day.
The Business NZ PMI will be released from New Zealand on Friday but the trading action is expected to remain subdued amid the Chinese New Year holiday.
Technical levels to watch for
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