NZD/USD edges lower to mid-0.6600s despite improving market mood
|- NZD/USD is edging lower following Friday's strong upsurge.
- US Dollar Index is clinging to modest gains above 93.00.
- Wall Street looks to open in the positive territory.
The NZD/USD closed the previous week little changed and continues to have a difficult time making a decisive move in either direction on Monday. As of writing, the pair was down 0.18% on a daily basis at 0.6653.
DXY posts modest recovery gains on Monday
Over the weekend, the People's Bank of China (PBoC) announced its decision to lower its reserve requirement ratio to zero for some forex exchange forwards trading with an aim to curb yuan's strength. The selloff witnessed in yuan at the start of the week made it difficult for the China-proxy kiwi to stay resilient against its rivals.
On the other hand, the greenback started the week on a firm footing with the US Dollar Index (DXY) staying in the positive territory above 93.00 and allowed the bearish pressure on NZD/USD to remain intact.
However, the S&P 500 futures are currently up 0.7% on a daily basis, suggesting that Wall Street is likely to open in the positive territory. Although the trading action in foreign exchange markets is expected to remain subdued due to the Columbus Day holiday, a sharp upsurge in US equity indexes could cause the DXY to erase its gains.
There won't be any macroeconomic data releases from New Zealand on Tuesday and the greenback's market valuation is expected to continue to impact NZD/USD's movements.
Technical levels to watch for
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