NZD/USD struggles near 1-week lows, below mid-0.6700s

Haresh Menghani FXStreet

• The prevalent risk-off mood helps revive greenback’s safe-haven demand.
• Weaker commodities/technical selling further aggravates the selling pressure.
• Traders now eye second-tier US economic data for some short-term impetus.

The NZD/USD pair extended this week's retracement slide from near one-month tops and kept losing ground for the third consecutive session on Thursday.

Having once again failed to sustain/build on its momentum beyond the very important 200-day SMA, the pair witnessed some aggressive long-unwinding pressure and was not being weighed down by a modest US Dollar uptick.

A slight deterioration in risk appetite, as depicted by a weaker tone around equity markets, provided a minor boost to the greenback's relative safe-haven status and was seen driving flows away from perceived riskier currencies - like the Kiwi.

Today's downfall could also be attributed to some follow-through technical selling below the 0.6800 handle, with the prevalent weaker tone around commodity space exerting some additional downward pressure on the commodity-linked currency.

Moving ahead, today's second-tier US economic releases - initial weekly jobless claims and Philly Fed Manufacturing Index, will now be looked upon for some short-term trading impetus later during the North-America session.

Technical levels to watch

Immediate support is pegged near the 0.6720-15 region, below which the pair is likely to break through the 0.6700 handle and retest mid-0.6600s important horizontal support. On the flip side, the 0.6770-75 region, closely followed by the 0.6800 handle now seems to act as immediate strong resistance, which if cleared might lift the pair back towards 0.6845-50 supply zone.

Author

Haresh Menghani

FXStreet

Haresh Menghani is a detail-oriented professional with 10+ years of extensive experience in analysing the global financial markets.

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