NZD/USD struggles to defend 0.5700 near two-year low on NZ off, Fed’s Powell, RBNZ’s Orr eyed


  • NZD/USD remains pressured around 30-month low amid New Zealand’s holiday.
  • US dollar cheers Russia-linked risk-aversion, hawkish Fedspeak.
  • Hawkish comments from RBNZ’s Orr may trigger the much-awaited corrective bounce.
  • Fed Chair Powell’s speech, risk catalysts are important too.

NZD/USD stays depressed around 0.5725, after refreshing the multi-day low to 0.5693, as the holiday in New Zealand restricts the Kiwi pair’s moves on Monday. Even so, the broad US dollar strength keeps the pair bears hopeful.

That said, the US Dollar Index (DXY) prints 0.60% intraday gains around 113.70, after renewing the 20-year high with 114.52 mark, as the risk-aversion wave joins the hawkish Fedspeak and firmer US data.

While portraying the mood, the S&P 500 Futures print mild losses while the US 10-year Treasury yields add four basis points to 3.74% at the latest.

It’s worth noting that fears of multiple central banks’ intervention and fears emanating from Russia weigh on the market sentiment.

Ukraine President Zelenskiy was last heard saying that maybe ''Putin's nuclear threats were a bluff, but now, it could be a reality'' as per a CBS interview. Meanwhile, the United States warned of "catastrophic consequences" if Moscow were to use nuclear weapons in Ukraine after Russia's Foreign Minister said regions holding widely-criticized referendums would get full protection if annexed by Moscow.

Additionally, the latest readings of the US S&P Global PMIs for August, published on Friday, stated that the Manufacturing gauge rose to 51.8 from 51.5, while its services counterpart recovered from 44.6 to 49.3 for September. Following the release, Fed Chairman Jerome Powell said, “We are committed to using our tools.” After him, Fed Vice Chair Lael Brainard mentioned that inflation is very high and is hitting low-income families ‘hard’. During the weekend, Atlanta Federal Reserve President Raphael Bostic said that he still believes the central bank can tame inflation without substantial job losses given the economy's continued momentum, reported Reuters while quoting the Fed policymaker’s interview on CBS' "Face the Nation".

It should be noted that the People’s Bank of China’s (PBOC) updates surrounding the increase in the Forex reserves tried to defend the NZD/USD buyers recently but failed amid the risk-off mood.

Moving on, speeches from Reserve Bank of New Zealand (RBNZ) Governor Adrian Orr and Fed Chairman Jerome Powell, respectively on Thursday and Wednesday respectively, will be crucial for the NZD/USD pair traders. Ahead of them, headlines surrounding China and Russia may join the second-tier US data to entertain traders.

Technical analysis

NZD/USD is on the way to test March 2020 low near 0.5470 unless crossing the previous support line from late August, around 0.5815 by the press time.

Additional important levels

Overview
Today last price 0.5732
Today Daily Change -0.0010
Today Daily Change % -0.17%
Today daily open 0.5742
 
Trends
Daily SMA20 0.6017
Daily SMA50 0.6169
Daily SMA100 0.6245
Daily SMA200 0.6501
 
Levels
Previous Daily High 0.5857
Previous Daily Low 0.573
Previous Weekly High 0.6003
Previous Weekly Low 0.573
Previous Monthly High 0.647
Previous Monthly Low 0.6101
Daily Fibonacci 38.2% 0.5779
Daily Fibonacci 61.8% 0.5808
Daily Pivot Point S1 0.5696
Daily Pivot Point S2 0.5649
Daily Pivot Point S3 0.5569
Daily Pivot Point R1 0.5823
Daily Pivot Point R2 0.5903
Daily Pivot Point R3 0.595

 

 

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