NZD/USD: Bears attack 0.7200 amid pre-Fed trading lull, focus on Aussie data

NZD/USD bounces off intraday low but remains depressed for the second consecutive day.
Cautious sentiment ahead of the key event, light calendar at home restrict moves.
Australia Q1 CPI, FOMC language will be the key.

Anil Panchal FXStreet

NZD/USD portrays a corrective pullback while bouncing the intraday low to 0.7206 amid Wednesday’s Asian session. Even so, the kiwi pair remains on the back foot amid cautious markets.

Strong US data and the highest growth in the US 10-year Treasury bond yields backed the US dollar’s recovery moves on Tuesday. However, the traders remained confused as risk catalysts flashed mixed signals, which in turn portrayed inaction by the Wall Street benchmarks.

The coronavirus (COVID-19) crisis in Japan and India poses serious challenges to global recovery hopes. Also on the same line could be the uneven progress of the covid vaccinations in the West.

Alternatively, easy travel plans from Europe, the US and the UK join expectations of removing further activity restrictions, initially levied to tame the virus, to keep the investors hopeful.

Against this backdrop, S&P 500 Futures struggle for a fresh direction while commodities wobble by the press time.

Moving on, a lack of major catalyst at home keeps NZD/USD at the mercy of Australia’s Q1 Consumer Price Index (CPI) figures, expected 1.4% YoY versus 0.9% prior. Although upbeat forecasts for the Aussie data may propel the kiwi pair’s latest bounce, the pre-Fed trading lull and haywire risk catalysts could confuse the traders.

Read: AUD/USD: Pressured below 0.7800 on cautious sentiment ahead of Australia Q1 CPI, FOMC

Technical analysis

NZD/USD pullback from 0.7245 battles a two-week-old support line around the 0.7200 threshold, a break of which can drag the pair further down towards a 100-day SMA level of 0.7162.

Additional important levels

Overview
Today last price	0.7206
Today Daily Change	-31 pips
Today Daily Change %	-0.43%
Today daily open	0.7237

Trends
Daily SMA20	0.7097
Daily SMA50	0.7153
Daily SMA100	0.7154
Daily SMA200	0.6931

Levels
Previous Daily High	0.7244
Previous Daily Low	0.7189
Previous Weekly High	0.723
Previous Weekly Low	0.7121
Previous Monthly High	0.7308
Previous Monthly Low	0.6943
Daily Fibonacci 38.2%	0.7223
Daily Fibonacci 61.8%	0.721
Daily Pivot Point S1	0.7202
Daily Pivot Point S2	0.7168
Daily Pivot Point S3	0.7147
Daily Pivot Point R1	0.7257
Daily Pivot Point R2	0.7278
Daily Pivot Point R3	0.7312

Author

Anil Panchal

FXStreet

Anil Panchal has nearly 15 years of experience in tracking financial markets. With a keen interest in macroeconomics, Anil aptly tracks global news/updates and stays well-informed about the global financial moves and their implications.

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