“¢ Fails to capitalize on the post-GDT price index attempted recovery move.
“¢ The prevalent USD bullish sentiment continues to exert downward pressure.
“¢ Traders now look forward to the US ADP report for some meaningful impetus.
The NZD/USD pair held on to its weaker tone on Wednesday, albeit has managed to recover a major part of the early slide to three-week lows.
The pair’s overnight attempted recovery, led by stronger GDT price index, ran into some fresh supply near the 0.6800 round figure mark and the downtick extended through the Asian session on Wednesday – marking its fifth day of downfall in the previous six.
The bearish pressure now seems to have abated, at least for the time being, and the pair once again found some technical support near the very important 200-day SMA, though the prevalent US Dollar bullish sentiment kept a lid on any meaningful recovery.
Against the backdrop of the recent rally in the US Treasury bond yields, Tuesday’s upbeat US economic releases – ISM non-manufacturing PMI and new home sales data, provided an additional boost and lifted the greenback to near two-week tops, around the 97.00 handle.
It would now be interesting to see if the pair is able to capitalize on the technical recovery or the current bounce is utilized as an opportunity to initiate some fresh bearish positions for an eventual near-term bearish break down below the important technical support.
Moving ahead, today’s US economic docket, highlighting the ADP report on the US private sector employment, will now be looked upon for some meaningful impetus ahead of a scheduled speech by New York Fed President John Williams later in the day.
Technical levels to watch
Any subsequent recovery move might continue to confront some fresh supply near the 0.6790-0.6800 region, above which the pair is likely to head towards testing 0.6850 intermediate resistance en-route the 0.6900 round figure mark. On the flip side, mid-0.6700s (200-DMA), closely followed by Feb. swing lows around the 0.6720 region might continue to protect the immediate downside, which if broken might turn the pair vulnerable to break through the 0.6700 handle and head towards testing its next major support near the 0.6650 region.