NZD/USD recovers notably as stocks erase losses

Peter Bukov Axiory Global Ltd.

The NZD/USD pair was trading 0.20% higher during the late US session and erased a huge daily loss as stock markets in the US rocketed vertically higher for no good reason. That improved the trading sentiment broadly and let to a short-covering in commodity-linked currencies.

Earlier in the day, the US new home sales beat expectations with a 4.8% MoM rise (-1.2% MoM expected) to 1.011 million (well above the 890,000 expected).

Moreover, the labor market seems stuck at the current unemployment levels as 870,000 Americans filed for first-time unemployment claims last week, slightly worse than the prior week's number and expectations. That is the eight week of initial claims in the 850k range.

The daily candle now looks like a very nice bullish pin bar, which is a reversal candle. It might indicate the current bearish trend is over, and a strong upward move can occur soon.

The immediate resistance could be seen near 0.66, and the Kiwi needs to push above this level for the medium-term trend to switch to bullish again.

Alternatively, the support could be at 0.6540 and afterward at today's lows of 0.6515.

Author

Peter Bukov

Axiory Global Ltd.

Peter Bukov is one of Axiory’s leading analysts. He has a master’s degree in Corporate Finance and is highly sought after as a teacher of Forex trading at various universities in Slovakia.

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