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NZD/USD accelerates to the downside amid risk-off

Discussion in 'Fundamental Analysis' started by FXStreet_Team, Feb 2, 2016.

  1. FXStreet_Team

    FXStreet_Team Well-Known Member Trader

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    FXStreet (Mumbai) - NZD/USD was one of the worst performers in Asia as risk sentiment deteriorated drastically after oil prices extended the slump and led the decline in the Asian markets.

    NZD/USD drops to hourly 20-SMA at 0.6515

    Currently, the NZD/USD pair trades -0.38% lower at 0.6524, retreating slightly from fresh session lows struck at 0.6514 in last hours. Having failed to sustain near the mid-point of 0.65 handle, the Kiwi witnessed heavy selling pressure over the last hours and skid to new session lows as the NZD tracked its OZ neighbour lower. The AUD/USD pair was heavily offered following RBA’s rates on-hold policy stance amid global market turbulence.

    Moreover, the ongoing weakness in the oil prices backed by weak Chinese manufacturing reports as well as by faltering OPEC output cut talks also dampens the sentiment around the resource linked-kiwi. Moreover, markets give up higher yielding assets amid risk-aversion and boost their investment into safety assets, which also acts as a drag on the NZD.

    Focus now shifts towards the NZ GDT price auction results due later today for fresh cues on the bird ahead of the crucial employment report from both the US and New Zealand due for release later this week.

    NZD/USD Levels to consider

    To the upside, the next resistance is located at 0.6554/59 (Daily High/ Feb 1 High), above which it could extend gains to 0.6592/0.6600 (Jan 13 High/ round number) levels. To the downside immediate support might be located at 0.6500/0.6497 (1h 50-SMA) and from there to 0.6484/83 (1h 200-SMA/ 20-DMA).
    For more information, read our latest forex news.
     

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