FXStreet – NZD/USD remains better bid with a high of 0.6718. The bird is supported by the 20 sma on the hourly sticks and the price has rallied through the 4hr 200 sma at 0.6607 with strong momentum. The greenback has been sold-off this week, but why?
“Neither dovish comments by ECB President Draghi, nor the Reserve Bank of New Zealand have managed to reverse the gains of their respective currencies,” explained analysts at Brown Brothers Harriman.
“Similar, the rise in US yields and firm equities have failed to push the yen lower. Investors and policymakers are trying to link news developments to the price action, but it seems to be a bit of a stretch. It is true that NY Fed President Dudley, who had suggested in late-August that a rate hike in September was less compelling, warned that financial conditions had tightened considerably since the December and that if this were sustained, it could alter the outlook for growth and the balance of risks.”
We now turn heads towards the nonfarm payrolls tomorrow. This will be key in and could either fuel further speculation that the Fed are on hold for longer or confirm that the economy remains on track and would warrant further tightening.
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NZD/USD levels
NZD/USD is technically overbought through 72 on the RSI (14) and reached 0.6748 high and 130 pips higher than the pivot of 0.6618. A period of consolidation might be expected. 0.6866 is the key target for a full reversal of the 2016 downtrend.
(Market News Provided by FXstreet)