NZD/USD seesaws near YTD lows on New Zealand holiday, 0.6585/80 in the spotlight
|- Heightened scope of a rate cut in May at the RBA and broad USD strength dragged the Kiwi to fresh 2019 lows.
- Holiday in New Zealand limits the moves but the overall bias remains supportive of the Kiwi’s downside.
The NZD/USD pair is trading near 0.6590 during early Asian morning on Thursday. The quote plummeted to the year’s fresh low on Wednesday as investors turned heavily towards the greenback amid negative signals from the rest of the globe. New Zealand markets are close in observance of Anzac Day and hence highlights the US and China developments for fresh impulse.
Rate cut consensus for its largest customer’s (Australia) central bank on the back of sluggish inflation initially hurt the New Zealand Dollar (NZD) on yesterday.
The move was carried forward as traders preferred risk-safety by buying the US Dollar (USD) amid pessimism surrounding Canada, Britain, etc.
The global risk barometer 10-year treasury yield from the US dropped five basis points to a fortnight low of 2.52%.
It should also be noted that the absence of Kiwi players shifts market focus on to the US traders which may put a high emphasis on weekly initial jobless claims and March month durable goods orders details.
Initial jobless claims for the week ended on April 19 are likely to have increased to 200K from 192K prior whereas durable goods orders growth could have risen by +0.8% from -1.6% earlier contraction. The nondefense capital goods orders ex-aircraft might also have reversed earlier -0.1% decline with +0.1% expansion during last month.
NZD/USD Technical Analysis
Despite breaking January lows near 0.6585, the pair refrained from closing beneath the same, which in-turn highlights brighter chances of its pullback to 0.6630 and 0.6670 due to oversold conditions of 14-day relative strength index (RSI).
Though, a sustained break of 0.6585, coupled with validation by clearing 0.6580 round-figure, might not hesitate fetching prices to October 2018 lows near 0.6465 with 0.6570 being an intermediate halt during the plunge.
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