NZD/USD: Sellers attack 0.7100 during three-day downtrend despite positives at home


  • NZD/USD stays mildly offered near three-week low, recently bounced off intraday low.
  • New Zealand’s Q4 NZIER Business Confidence, Electronic Card Retail Sales for December improved.
  • New Zealand to require a pre-departure covid test from next week amid fears of virus spread.
  • US politics, COVID-19 updates will be the key to follow.

NZD/USD remains on the back foot for the third consecutive day while easing to 0.7110 during Tuesday’s Asian trading. In doing so, the kiwi pair fades bounce off 0.7096, the lowest level since December 29 flashed the previous day, despite welcome fundamentals from New Zealand.

As per the fourth-quarter (Q4) Quarterly Survey of Business Opinion (QSBO) from the New Zealand Institute of Economic Research (NZIER), also known as NZIER Business Confidence, business optimism in the pacific nation has improved during late 2020. The report said, “A net 16% of businesses expect a deterioration in general economic conditions over the coming months, on a seasonally adjusted basis – lower than the 38% in the previous quarter, and well below the 68 percent of businesses feeling pessimistic in March 2020.”

Following that, New Zealand’s Electronic Card Retail Sales grew past-1.0% forecast and 1.4% previous readouts to 3.5% YoY in December.

On the negative side, the New Zealand government raised bars for foreign arrivals by requiring a pre-departure covid-negative test result, except Australia, Antarctica and most Pacific Island countries, starting from January 25. Elsewhere, US President Donald Trump eases travel restrictions from Brazil and Europe, per Reuters, while Australia has its activity restrictions on the cards.

It should be noted that the kiwi pair’s downside the previous day failed to justify upbeat China data. Recently, US President Trump published an executive order to prioritize removing Chinese drones from government fleets. To provide some background, China is the world’s largest commodity player and any negative for it could adversely affect Antipodeans including NZD/USD.

Considering a light calendar in Asia, coupled with a cautious sentiment ahead of the key speeches from the incoming government to the US, NZD/USD may remain depressed despite upbeat domestic catalysts.

Technical analysis

A sustained downside break of an ascending trend line from November 13, currently around 0.7155, directs NZD/USD sellers toward a 50-day SMA level of 0.7077.

Additional important levels

Overview
Today last price 0.7112
Today Daily Change -25 pips
Today Daily Change % -0.35%
Today daily open 0.7137
 
Trends
Daily SMA20 0.7148
Daily SMA50 0.7056
Daily SMA100 0.6857
Daily SMA200 0.6617
 
Levels
Previous Daily High 0.7234
Previous Daily Low 0.7118
Previous Weekly High 0.7241
Previous Weekly Low 0.7118
Previous Monthly High 0.7241
Previous Monthly Low 0.7002
Daily Fibonacci 38.2% 0.7162
Daily Fibonacci 61.8% 0.719
Daily Pivot Point S1 0.7092
Daily Pivot Point S2 0.7047
Daily Pivot Point S3 0.6976
Daily Pivot Point R1 0.7208
Daily Pivot Point R2 0.7279
Daily Pivot Point R3 0.7324

 

 

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