- A goodish pickup within the USD demand prompted some promoting round NZD/USD on Tuesday.
- COVID-19 jitters benefitted the safe-haven USD and weighed on the perceived riskier kiwi.
- The US Client Confidence Index eyed for some impetus forward of FOMC on Wednesday.
The NZD/USD pair prolonged its regular intraday descent and refreshed day by day lows, across the 0.7200 mark in the course of the first half of the European session.
The pair witnessed some promoting on Tuesday and has now eroded part of the day before today’s goodish optimistic transfer to the very best stage since March 18. This marked the primary day of a damaging transfer within the earlier three and was sponsored by the emergence of some shopping for across the US greenback.
Buyers now appear fearful that surging COVID-19 infections in some international locations, together with India and Japan, might derail the worldwide financial restoration. This, in flip, drove some haven flows in the direction of the dollar and was seen as a key issue exerting stress on the perceived riskier kiwi.
Aside from this, the USD uptick lacked any apparent catalyst and is prone to stay capped amid expectations that the Fed will hold rates of interest low for an extended interval. Therefore, the important thing focus will stay on the newest FOMC financial coverage replace, scheduled to be introduced on Wednesday.
Heading into the important thing occasion threat, some repositioning commerce would possibly affect some volatility across the NZD/USD pair. Within the meantime, merchants are prone to take cues from Tuesday’s launch of the Convention Board’s US Client Confidence Index, due later in the course of the early North American session.
The info, together with the broader market threat sentiment, would possibly affect the USD worth dynamics. This, in flip, ought to present some impetus to the NZD/USD pair and permit merchants to seize some short-term alternatives.
Technical ranges to observe