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NZD/USD fails to capitalize on a weaker US Dollar and tumbles below the 200-DMA

  • NZD/USD fails to capitalize on sentiment improvement and tumbles influenced by a technical indicator.
  • The US Dollar tumbled while UST bond yields rose, a headwind for the NZD/USD.
  • NZ Trade of Balance and US Existing Home Sales data eyed.

NZD/USD reversed its course after piercing the 200-day Exponential Moving Average (EMA), tumbling 0.12%, as Wall Street is about to close. US equities are about to finish the day in an upbeat mode, though the New Zealand Dollar (NZD) is at the mercy of technical indicators. At the time of writing, the NZD/USD exchanges hands at 0.6248.

NZD/USD stumbles at the 200-day EMA, despite a risk-on impulse

With the looming US Federal Reserve (Fed) monetary policy meeting, the markets could begin to trade sideways. Even though sentiment improved, the NZD could not capitalize, with markets focusing on Jerome Powell and Co. Therefore, the NZD/USD edged lower after printing a daily high of 0.6281.

Last Friday, the latest round of US economic data cemented the case for an ongoing economic slowdown. Industrial Production eased, Consumer Sentiment deteriorated, as reported by the University of Michigan (UoM), and inflation expectations cooled down amidst ongoing turbulence in the financial markets.

Traders continued to digest the news that UBS bought Credit Suisse, which supposedly could stop the bank’s stock riot. Nonetheless, newswires reported that First Republic Bank stock halted for a ninth time in the day, with shares plunging 50% at one point before pairing losses, dropping 33%.

In the meantime, the US Dollar Index, a gauge for the buck’s value against a basket of six currencies, losses 0.53%, at 103.312. Contrarily, US Treasury bond yields erased their earlier losses, with the 10-year bond yield gaining six basis points at 3.498%.

Aside from this, the New Zealand (NZ) economic docket will feature the NZ Trade of Balance for February, with estimates at NZ $-1.450 B, less than the previous reading of NZ $-1.954B. Exports for January came at NZ $5.47B, while Imports were NZ $7.42 B. Another factor that could underpin the NZD is the Reserve Bank of Australia’s monetary policy.

On the US front, the docket will feature Existing Home Sales and the beginning of the two-day US Federal Reserve Open Market Committee (FOMC) monetary policy meeting

NZD/USD Technical levels

NZD/USD

Overview
Today last price0.6245
Today Daily Change-0.0024
Today Daily Change %-0.38
Today daily open0.6269
 
Trends
Daily SMA200.6194
Daily SMA500.6313
Daily SMA1000.6263
Daily SMA2000.6162
 
Levels
Previous Daily High0.6278
Previous Daily Low0.6178
Previous Weekly High0.6278
Previous Weekly Low0.6131
Previous Monthly High0.6538
Previous Monthly Low0.6131
Daily Fibonacci 38.2%0.624
Daily Fibonacci 61.8%0.6216
Daily Pivot Point S10.6205
Daily Pivot Point S20.6141
Daily Pivot Point S30.6105
Daily Pivot Point R10.6305
Daily Pivot Point R20.6342
Daily Pivot Point R30.6406
 

Author

Christian Borjon Valencia

Markets analyst, news editor, and trading instructor with over 14 years of experience across FX, commodities, US equity indices, and global macro markets.

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