NZD/USD: Depressed in a choppy range around mid-0.7100s amid US dollar gains

NZD/USD stays pressed between 0.7146 and 0.7164 following its heaviest decline in a week the previous day.
The pair struggles for a clear direction as risk-on mood, RBNZ optimism battles the US dollar strength.
Updates from trading partner Australia can offer intermediate moves, coupled with risk catalysts, ahead of US NFP.

Anil Panchal FXStreet

NZD/USD seesaws around 0.7155-60 amid Friday’s Asian trading session. The kiwi pair marked the biggest losses in seven days the previous day amid the broad US dollar strength. However, pre-NFP trading lull and a lack of major data/events at home seem to have confined the quote’s latest moves.

The kiwi pair’s latest moves, actually inaction, fail to respect the cautious optimism conveyed by the central bank governor of its largest trading partner. RBA Governor Philip Lowe struck economic optimism while also conveying no rate hike odds before 2024 in his latest testimony.

Read: RBA's Lowe: Interest rates are going to be low for quite a while yet

On Thursday, increasing odds for the $1.9 trillion covid relief stimulus from US President Joe Biden and upbeat employment-related data from America helped the US dollar index (DXY) to jump to the highest levels since December 01, 2020. Also favoring the greenback were downbeat figures from Europe and virus/vaccine improvement elsewhere. Furthermore, chatters that the market frenzy has another round to offer also backed the US dollar.

Amid these plays, the S&P 500 and Nasdaq 100 marked record-high close at the end of Thursday’s trading whereas the S&P 500 Futures struggle for direction by press time.

Moving on, RBA’s quarterly economic forecasts and Aussie Retail Sales may entertain traders ahead of the key US Nonfarm Payrolls (NFP) data for January. It should be noted that any major updates concerning the American aid package and/or retail rush, as well as virus/vaccine news, also have their direct impact on NZD/USD and hence shouldn’t be missed.

Read: Nonfarm Payrolls Preview: Dollar needs a strong number to keep rallying

Against this backdrop, analysts from the Australia and New Zealand Banking Group (ANZ) stay bullish as they said, “The Kiwi has made an about-turn overnight as the USD has stretched its legs amid higher interest rates and rallying equities, but it remains within well-established ranges. This recent fall is somewhat surprising given that the market has adopted the view that the RBNZ will be one of the earlier “hikers”, and given the performance of recent economic data. With that in mind, all eyes are on US employment data tonight. Nonetheless, having not completely broken down, we’re more inclined to characterize the overnight as merely a correction.”

Technical analysis

An ascending trend line from November 24, 2020, joins 50-day SMA, currently around 0.7145-40 to restrict the immediate downside of the NZD/USD prices.

Additional important levels

Overview
Today last price	0.7156
Today Daily Change	-48 pips
Today Daily Change %	-0.67%
Today daily open	0.7204

Trends
Daily SMA20	0.7185
Daily SMA50	0.7127
Daily SMA100	0.6918
Daily SMA200	0.6691

Levels
Previous Daily High	0.7226
Previous Daily Low	0.7157
Previous Weekly High	0.7248
Previous Weekly Low	0.7105
Previous Monthly High	0.7316
Previous Monthly Low	0.7096
Daily Fibonacci 38.2%	0.72
Daily Fibonacci 61.8%	0.7183
Daily Pivot Point S1	0.7165
Daily Pivot Point S2	0.7127
Daily Pivot Point S3	0.7096
Daily Pivot Point R1	0.7234
Daily Pivot Point R2	0.7265
Daily Pivot Point R3	0.7303

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.

EUR/USD gains traction to near 1.1800 as tariff uncertainty weighs on US Dollar

The EUR/USD pair holds positive ground around 1.1795 during the early Asian session on Tuesday. The US Dollar weakens against the Euro amid US tariff uncertainty. The release of the US January Producer Price Index report will be in the spotlight later on Friday.

GBP/USD treads water near 1.3500 as BoE-Fed divergence debate stalls

GBP/USD spent Monday spinning in place as market participants await a fresh catalyst to break the pair out of its recent range. The BoE's February hold came with a surprisingly dovish 5-4 split, and UK Consumer Price Index data last week showed inflation easing to 3.0%, reinforcing the case for earlier rate cuts, with most economists now looking to April or March for the next move.

Gold falls below $5,200 amid pullback from monthly highs

Gold price is back under the $5,200 level in the Asian session on Tuesday, pulling back from the highest level in four weeks reached at $5,250 earlier on. The Gold price upsurge was fuelled by heightened geopolitical tensions and global trade uncertainty following US tariff decisions. However, an improvement in risk sentiment and a fresh US Dollar upswing trigger a corrective decline in the yellow metal.

Solana DeFi platform Step Finance to close operations following treasury hack

The Solana based decentralized finance platform Step Finance announced it will end all operations effective immediately following a breach that drained its treasury.

Supreme Court nixes tariffs, Trump teases 15% global tariff

On February 20th, the Supreme Court ruled that Trump’s global tariffs under IEEPA authority were unconstitutional, effectively nullifying the framework. However, the relief was short-lived. Within hours, Trump floated a 15% blanket tariff under an alternative legal authority.

XRP recovers slightly as bearish sentiment dominates crypto market

Ripple is rising above $1.40 at the time of writing on Monday amid fresh tariff-triggered headwinds in the broader cryptocurrency market. The sell-off to $1.33, the token’s intraday low, can be attributed to macroeconomic uncertainty, geopolitical tensions and risk-averse sentiment among other factors.