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NZD/USD drops towards multi-month low below 0.6950 as risk sentiment deteriorates

  • NZD/USD continues with the previous day’s selling pressure and tests the multi-month low.
  • US dollar remains steady below 13-week highs on risk jitters.
  • Risk aversion among investors turns Kiwi lower against the US dollar.

NZD/USD extends the previous session's downside momentum in the Asian session and retests the multi-month low in the vicinity of 0.6940 area.   

The pair witnessed heavy selling pressure in the American session and retreated further from near three-week tops, the levels just above the 0.7100 mark touched earlier in this week.

The rebound in the US Dollar Index (DXY), which measures the greenback performance against its six major rivals, drags NZD/USD toward lower levels. The DXY trades steady below 13-weeks high at 92.4 amid a fall in US Treasury yields due to renewed concerns on US  growth recovery.

The US Initial Jobless Claims rose unexpectedly, which signaled the labor market recovery remained far from Fed’s target. The data came at 373 K, above the market expectations at 350K.

Investors remain cautious about the concern on rising Delta variant COVID-19 infections. Increasing corona cases in the Asia-Pacific region underpins the demand of the US dollar on the back of its global safe haven asset.

On the other hand, Kiwi lost its ground as risk appetite worsened due to increasing COVID-19 cases in neighbouring countries as investors feared that it could derail the global economic recovery.

Meanwhile, the Reserve Bank of New Zealand (RBNZ) will announce its bond purchasing program. The Bank of New Zealand (BNZ) expected the program would end soon irrespective of the RBNZ decision to hold the amount steady at $200m or reduce it.

It is worth noting that S&P 500 Futures were trading at 4,294 with 0.043% gains.

The modest US dollar strength and a sharp deterioration in the global risk sentiment continue to influence the pair’s performance in the absence of any major fundamental catalyst.

NZD/USD additional levels

NZD/USD

Overview
Today last price0.6926
Today Daily Change-0.0030
Today Daily Change %-0.43
Today daily open0.6956
 
Trends
Daily SMA200.703
Daily SMA500.7144
Daily SMA1000.7149
Daily SMA2000.7066
 
Levels
Previous Daily High0.7023
Previous Daily Low0.6935
Previous Weekly High0.7087
Previous Weekly Low0.6947
Previous Monthly High0.7289
Previous Monthly Low0.6923
Daily Fibonacci 38.2%0.6968
Daily Fibonacci 61.8%0.6989
Daily Pivot Point S10.6919
Daily Pivot Point S20.6883
Daily Pivot Point S30.6831
Daily Pivot Point R10.7007
Daily Pivot Point R20.7059
Daily Pivot Point R30.7096


 

Author

Rekha Chauhan

Rekha Chauhan

Independent Analyst

Rekha Chauhan has been working as a content writer and research analyst in the forex and equity market domain for over two years.

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