“¢ Dismal NZ employment data prompts some aggressive selling on Wednesday.
“¢ The prevalent USD selling bias helped limit further losses/bounce off daily lows.
“¢ Traders eye US economic data for some impetus ahead of the FOMC decision.
The NZD/USD pair held on to its weaker tone through the mid-European session, albeit has managed to recover around 25-30 pips from daily lows.
Having failed to make it through the 0.6685-90 supply zone, the pair met with some aggressive selling pressure during the Asian session on Wednesday following the disappointing release of quarterly New-Zealand employment report.
Although the unemployment rate ticked lower to 4.2%, an unexpected fall in the number of employed people during the first quarter of 2019 fueled speculations above an eventual RBNZ rate cut and exerted some heavy downward pressure.
However, the ongoing US Dollar pullback from two-year tops, touched in reaction to stronger US GDP figures, extended some support and turned out to be one of the key factors that helped limited further downside, at least for the time being.
Moving ahead, today’s US economic docket – featuring the release of ADP report and ISM manufacturing PMI, will now be looked upon for some short-term trading impetus ahead of the key event risk – the latest FOMC monetary policy update.
Technical levels to watch
Any subsequent up-move might continue to confront some fresh supply ahead of the 0.6900 handle, above which a fresh bout of short-covering could lift the pair further towards the very important 200-day SMA resistance near the 0.6925-30 region.
On the flip side, the 0.6630-25 region now seems to have emerged as an immediate support and is closely followed by the 0.6600 round figure mark, which if broken might turn the pair vulnerable to slide further below YTD lows and test 0.6565 support area.
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