- NZD/USD gapped higher at 0.6917 - a level last seen on June 25 - and is currently trading at 0.6905.
- The NZD likely picked up a bid on US-China trade truce.
- Extended risk-on action in the financial markets could push the NZD above the immediate hurdle of 0.6922.
The NZD/USD opened at a five-month high of 0.6917 on fading US-China trade tensions.
The US President Trump and his Chinese counterpart Xi Jinping reached a ceasefire weekend over the weekend under which the US will hold off imposing further tariffs on the US and in return China would buy a substantial amount of US goods.
That truce will remain valid for three months, during which both sides will negotiate a permanent trade deal. The US will likely escalate trade war if parties fail to reach an.
The temporary pause in the trade war has put a strong bid under the risky assets. For instance, the S&P 500 is up 1.5 percent and oil benchmarks are reporting 4 percent gains. The Chinese yuan has gained 0.5 percent.
The risk-on action is boding well for the commodity dollars like the NZD and AUD. At press time, the NZD/USD is trading at 0.6906, up 7.5 percent from the yearly low of 0.6424 reached on Oct. 8.
China Caixin manufacturing PMI for November released a few minutes before press time, showed the activity improved slightly, but failed to lift the NZD, possibly because the details revealed a weakening domestic demand.
It is worth noting that a temporary truce was highly anticipated and was more or less price in the last week. As a result, the S&P 500 futures may trim gains, in which case the NZD may have a tough time scaling the immediate resistance of 0.6922 (June 25 high). The resistance, however, will likely be crossed if the equities extend gains the EUR/USD picks up a strong bid.
NZD/USD Technical Levels
NZD/USD
Overview:
Today Last Price: 0.6904
Today Daily change: 30 pips
Today Daily change %: 0.436%
Today Daily Open: 0.6874
Trends:
Previous Daily SMA20: 0.6792
Previous Daily SMA50: 0.6649
Previous Daily SMA100: 0.6661
Previous Daily SMA200: 0.6867
Levels:
Previous Daily High: 0.6886
Previous Daily Low: 0.6851
Previous Weekly High: 0.6887
Previous Weekly Low: 0.6753
Previous Monthly High: 0.6887
Previous Monthly Low: 0.6514
Previous Daily Fibonacci 38.2%: 0.6873
Previous Daily Fibonacci 61.8%: 0.6864
Previous Daily Pivot Point S1: 0.6855
Previous Daily Pivot Point S2: 0.6835
Previous Daily Pivot Point S3: 0.682
Previous Daily Pivot Point R1: 0.689
Previous Daily Pivot Point R2: 0.6905
Previous Daily Pivot Point R3: 0.6925
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