- Rallies in tandem with risk on US tariffs implementation on China.
- Will the rebound last? Markets could turn risk-averse ahead of China retaliation, US NFP.
The NZD/USD pair brought an end to its choppy trading and bounced after the US unleashed the first round of tariffs on the Chinese goods earlier today.
The tariffs action by the US on China came as a little shock to the world markets, as it was long priced-in and hence, the risk sentiment improved, driving the higher-yielding NZD higher in tandem. The Asian equities took the US tariffs in stride, with the Nikkei 225 index rallying +1.30% while China indices also jumped +1% to +1.80%.
However, it remains to be seen if the spot can sustain the bounce above the 0.68 level, as markets still remain jittery, in anticipation of China’s retaliation, which may trigger a risk-off mode in the session ahead. Also, a stronger US jobs report could offer some impetus to the USD bulls, capping the upside in the Kiwi.
NZD/USD Technical Levels
According to Ross Burland, Analyst at FXStreet, “0.6680 is the key support while 0.6850 is the first key upside target on a continuation of the reversal through the 200-hr SMA at 0.6785 where the price is holding above. Only a break above 0.6850 would alleviate the downside pressures and eyes remains towards 0.6675. On the wide, while below the key 200-month moving average resistance at 0.7007 longer term technicals remain bearish.”
Share
