- NZD/USD attacks the upper end of the 0.6630-55 trading range.
- Market sentiment improves on Trump’s health recovery, hopes of stimulus and Brexit-positive headlines.
- A lack of catalysts at home, off in China probe traders to wait for RBA, Aussie budget.
NZD/USD rises to 0.6650 amid the early Asian session on Tuesday. The kiwi pair marked no major moves while taking rounds to the mid-0.6600 area the previous day despite a broad risk-on mood. The reason could be traced from a light calendar at home as well as a weeklong holiday in major customer China.
Traders await overseas catalysts…
Despite market optimism, mainly backed by US President Donald Trump’s health recovery and hopes of American stimulus, NZD/USD buyers await a clear signal to extend its recovery moves from late-September. As a result, the RBA Interest Rate Decision and Australian budget release, respectively around 03:30 and 08:30 GMT, can play as the factors to determine near-term pair moves.
It should, however, be noted that Trump’s recent inclination to keep the election campaign running, with his presence on major events, adds to the risk-on mood. On the other hand, US House Speaker Nancy Pelosi and Treasury Secretary Steve Mnuchin are ready to talk over the much-awaited aid package but are yet to roll out the details. Elsewhere, the European and British policymakers’ readiness to give a final push to the Brexit talks also adds to the upbeat environment.
Challenging the mood is the increasing pace of the coronavirus (COVID-19) numbers from the White House as well as an absence of major triggers at home and China.
While portraying the market’s mood, Wall Street benchmarks grew over 1.0% on average whereas the S&P 500 Futures rise 0.12% towards 3,400 by the time of the press.
Looking forward, NZD/USD traders will keep eyes on the Aussie trade numbers and RBA ahead of the Australia budget release for fresh impetus. The hopes of dovish statements from the Aussie central bank, coupled with tax-cut expectations from the Pacific major’s government, are likely to keep the bulls on the table. Furthermore, forecasts favoring upbeat Aussie Trade Balance for August can also please the buyers. Though, any surprises and a shift into the risk-on mood can give sellers the reasons to attack 0.6600 round-figure.
Read: AUD/USD: Wavers below 0.7200 ahead of RBA, Aussie budget
Technical analysis
FXstreet’s Ross J Burden highlights the bearish head-and-shoulders pattern on the weekly chart to keep NZD/USD sellers hopeful.
Read: NZD/USD Price Analysis: Head and Shoulders patterns in play
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