FXStreet (Bali) – NZD/USD is building up on recent gains on the back of downbeat employment numbers in Australia, which has spurred aggressive selling flows in AUD/NZD, and as a result, given a boost to the Kiwi across the board.
NZD the darling of FX in recent days
NZD/USD is last exchanging hands at 0.6811 after being rejected quite abruptly at the 0.6850 vicinity. The Kiwi remains the top performer in the FX market, having gained more than 3% during Wednesday, following a speech by RBNZ Governor, who while reinforcing the dovish bias (key paragraphs below), cemented the belief by some institutions, that a potential rate hold outcome this month may be the most likely outcome, with further cuts later this year.
RBNZ Wheeler speech: Key paragraphs
“Recent economic indicators have been more encouraging. Some further easing in the OCR seems likely, but this will continue to depend on the emerging flow of economic data. At the same time, however, we remain conscious of the impact that low interest rates can have on housing demand and its potential to feed into higher price inflation. It is important also to consider whether borrowing costs are constraining investment, and the need to have sufficient capacity to cut interest rates if the global economy slows significantly.”
NZD/USD key levels for today
The pair remains well control by buying participants near term, with the acceptance above the 0.68 handle (Weekly R1), potentially exposing a higher auction process towards a test of today’s high at 0.6850 and head of 0.6862 (Daily R1). Beyond the latter, 0.6880 is the ATR 14 limit for the day, followed by the round number 0.69, which happens to intersect with the Weekly R2. On the downside, a loss of 0.6790/68 may expose 0.6750/55 (last swing low in the US + ATR 14 limit), followed by 0.6740 (horizontal support level + daily pivot), ahead of 0.67 psychological area.
(Market News Provided by FXstreet)