FXStreet (Mumbai) – NZD/USD extends its downward spiral into a third-day on Monday, setting-off the week on a bearish note, as the markets ignored upbeat NZ business confidence data against the backdrop of lower commodities and a broadly stronger US dollar.
NZD/USD finds support at daily S2
Currently, the NZD/USD pair trades modestly flat at 0.6531, recovering from fresh session lows struck at 0.6514. The Kiwi attempts a tepid-bounce from lows, having found renewed bids just ahead of the daily S2 placed at 0.6511.
NZD/USD failed to benefit from improving NZ business confidence numbers and hovers near four-day lows on the 0.65 handle, with the sentiment dampened by persisting weakness in commodity prices and also on the ongoing upward momentum in the US currency. The USD index trades near fresh eight month highs reached at 100.28 earlier on the day, now gaining 0.17%.
Meanwhile, the ANZ Business Confidence Index, jumped to 14.5% in Nov from a net 10.5% rise seen previously, hitting the strongest level since May. The solid rise in the business confidence gauge suggests that the RBNZ could wait before further rate cut at its next month’s meeting.
Markets also remain cautious ahead of a data-heavy week, with a slew of crucial economic releases from China and the US to direct further moves in the pair. The Chinese manufacturing surveys and the NZ GDT price index are due for release tomorrow.
NZD/USD Levels to consider
To the upside, the next resistance is located at 0.6554 (1h 100-SMA), above which it could extend gains to 0.6582 (Nov 27 High) levels. To the downside immediate support might be located at 0.6511 (daily S2) below that 0.6491 (Nov 23 Low).
(Market News Provided by FXstreet)