NZD/USD bears taking control and eye a break of the 0.68 handle
- NZD/USD headed for a break of key support and the 0.68 handle?
- NZD/USD suffers a bid in the greenback in early Asia.
NZD/USD has started to slide further making fresh lows since the 21st November's business on the first day of the new month in Asia. Currently, NZD/USD is trading at 0.6818, down -0.26% on the day, having posted a daily high at 0.6843 and low at 0.6818.
Forex today: why can't the dollar capitalize on good news?
NZD/USD has dropped as the greenback picks up a bid in early Asia after a mixed day in NY where it just could not find sustained traction despite the positive environment, good news and promising data. Kiwi was, however, a poor performer overnight, perhaps the worst vs the dollar and made a 0.6830 low (0.6834 closing) after running into strong offers at 0.6889 the high. Yesterday’s weak business confidence sent the NZD down towards those support levels and analysts at ANZ argued that it is likely to continue to trade with a defensive bias today.
New Zealand: Terms of trade reach new record in Q3
"But the fact it didn’t push lower during the overnight session is somewhat telling and suggests that global developments (USD strength especially) is going to be required for the kiwi to push meaningful lower in the near term," the analysts at ANZ added.
Data and headlines
The latest domestic news from NZ came with the terms of trade index for 3Q that arrived at 0.7% vs. 1.3% estimate. For the last quarter, the index was up 1.4%, revised lower from 1.5%. Meanwhile, for the US data and headlines, the US Oct Core PCE Price Index for MM arrived at 0.2%, vs 0.2% consensus and vs 0.1% prior that was revised to 0.2% from 0.1%. For YY, the data came in at 1.4% vs 1.3% previous 1.4% that was also revised from 1.3%, all of which keeps the Fed on track for a rate hike in December. Other data had the US Weekly Initial Jobless Claims at 238k, vs 240k forecast and 239k prev 240k that was revised while US weekly Continued Jobless Claims came in at 1.957 mln vs 1.904 mln prior 1.915 mln, also revised. In respect to the GOP's tax reform plans, McCain was backing the U.S. Senate tax bill today, boosting chances of approval.
NZD/USD levels
- Support: 0.6780.
- Resistance: 0.6920.
NZD/USD has reached a key near-term support area between 0.6815-20 guarding a break of the 0.68 handle towards the 17-month low level of 0.6780. 0.6845-50 region guards 0.6925-30 and yesterday's double top highs ahead of the larger 28th Nov double-top highs of 0.6942.