NZD/USD bears catch a breath around 0.6390 after RBNZ’s Orr, coronavirus update

NZD/USD snaps four-day losing streak.
Risk aversion, downbeat New Zealand data dominated off-late.
RBNZ’s Orr favored the status quo, said the economy is in a good position.
Coronavirus numbers from Hubei signaled a mixed picture.

Anil Panchal FXStreet

NZD/USD pulls back from seven-day low to 0.6390 amid the initial Asian session on Wednesday. Mostly upbeat comments from the Reserve Bank of New Zealand (RBNZ) Governor Adrian Orr and receding coronavirus numbers from the epicenter Hubei could be cited as the immediate catalysts. However, the broad risk aversion remains following the latest doubts on the actual figure and length of the epidemic.

RBNZ’s Orr: Good position

The RBNZ Governor Adrian Orr recently crossed wires while speaking in front of the committee in parliament to answer questions related to the Bank's annual report. The New Zealand central banker praised the present state of the monetary policy and economy while also suggesting a satisfactory position of inflation. With this, the odds of the RBNZ’s immediate rate cut decline. “Market pricing for RBNZ implies a 10% chance of easing at the next meeting on 25 March, with a terminal rate of 0.82% (RBNZ OCR currently at 1.0%,” mentions Westpac.

Read: RBNZ: Both the economy and monetary policy are in a good position

Coronavirus update: Numbers from Hubei fail to follow the recent declines

As per the latest figures from China’s Hubei, the epicenter of coronavirus, there are 1,693 new cases on February 18 versus 1,807 of February 17. The report also mentions 132 new deaths compared to 93 noted the previous day.

Read: Coronavirus peaking? How will it impact the global economies and FX?

Even so, the market’s risk-tone refrains to turn positive as the S&P 500 Futures stay mostly unchanged around 3,370.

Earlier, downbeat figures of New Zealand’s GDT Price Index, -2.9% versus 0.0% expected, contradicted the upbeat US data and broad US dollar strength to drag the kiwi pair downwards. It should also be noted that doubts over the coronavirus numbers and fears of global institutions like the International Monetary Fund (IMF) and the World Trade Organization (WTO) defied China’s readiness to cut tariffs of 696 US goods.

Moving on, a light economic calendar at home will keep the pair traders at the mercy of external factors with China, Australia and the US being the key drivers.

Technical Analysis

Any downside below the monthly bottom of 0.6377 can drag the quote to November 2019 low near 0.6315.

Additional important levels

Overview
Today last price	0.6386
Today Daily Change	-0.0054
Today Daily Change %	-0.84%
Today daily open	0.644

Trends
Daily SMA20	0.6491
Daily SMA50	0.6577
Daily SMA100	0.6481
Daily SMA200	0.6499

Levels
Previous Daily High	0.6449
Previous Daily Low	0.642
Previous Weekly High	0.6488
Previous Weekly Low	0.6377
Previous Monthly High	0.6741
Previous Monthly Low	0.6453
Daily Fibonacci 38.2%	0.6431
Daily Fibonacci 61.8%	0.6438
Daily Pivot Point S1	0.6424
Daily Pivot Point S2	0.6408
Daily Pivot Point S3	0.6395
Daily Pivot Point R1	0.6453
Daily Pivot Point R2	0.6465
Daily Pivot Point R3	0.6482

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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