- NZD/USD trades near 0.6800 ahead of Asian session on Friday.
- The pair followed mostly negative Australian headlines off-late.
- 0.6770 can act as immediate support with 0.6830 likely nearby resistance.
NZD/USD flirts around a week’s low of 0.6800 before Asian markets start on Friday. Lack of big releases/events at home and reliance on Australian headlines amid slowing PMI data at the US and the EU dragged the Kiwi decline like Aussie. With no major catalysts up at home, the New Zealand Dollar (NZD), also known as Kiwi, may keep copying the Australian Dollar (AUD), mostly called Aussie.
With the seesaw moves at its second largest trading partner after China, namely Australia, the NZD couldn’t ignore the sellers. The Aussie initially rallied on upbeat employment numbers but then slumped on Westpac’s call for interest-rate cuts. Then, China’s readiness to import more agricultural products from the US triggered a pullback which lost its strength on news that China’s Dalian Port will ban coal imports from Australia.
Other than mostly negative news from offshore, overall weakness in the US and the EU PMIs also weakened antipodeans. The US Markit Manufacturing PMI dropped to 53.7 from 54.7 market consensus while Philly Fed Manufacturing Index tested -4.1 level in February from 17 in January. On the other hand, EU Markit Manufacturing PMI plunged to contraction region figure of 49.2 from 50.5 registered previous month.
Contrast to negatives for the NZD, a slew of comments from the Federal Reserve officials after an upbeat report of January month monetary policy meeting minutes and progress on trade discussions with China strengthened the US Dollar (USD). Additionally, pessimism surrounding the EU and the UK played counterproductive for the greenback.
Looking forward, progress on the US-China negotiations for the trade deal and comments from the Reserve Bank of Australia (RBA) Governor Philip Lowe can direct near-term Kiwi moves due to lack of major news up for release at home.
NZD/USD Technical Analysis
Sustained break of immediate support-line connecting a week’s lows signal brighter chances of the NZD/USD’s additional downside towards 0.6770 ahead of looking at 0.6740 and 0.6710 for follow-on rest.
On the upside, 0.6830 works as a nearby resistance for the pair, a break of which can propel it to 0.6850 & 0.6890 numbers to the north.