NZD/USD stays on the front foot around 0.6600 amid broad USD weakness
- NZD/USD extends two-day-old recovery amid broad declines of the greenback.
- Upbeat domestic fundamentals, trade news also contributed to the pair’s strength.
- A lack of drivers at home will keep the quote at the mercy of offshore data/events, trade headlines.
Following its second consecutive daily gains, NZD/USD takes the bids to 0.6605 at the start of Friday’s Asian session. The pair recently benefited from the USD weakness and welcome catalyst at home and abroad. Traders may now witness thin volatility amid an absence of major data/events at home. Though, trade/political headlines still have the ability to offer surprises.
Recently published ANZ-Roy Morgan Consumer Confidence for December came in at 123.30 versus 121.00 prior. The sentiment gauge surged for the third time in a raw. On Thursday, New Zealand’s third quarter (Q3) Gross Domestic Product (GDP) came in as a 0.7% QoQ versus 0.6% forecast. Additionally, upbeat employment data from the largest customer Australia also contributed to the kiwi pair’s upside during the previous day.
On the trade front, Xinhua’s news that China’s rolling back some more tariffs for the US shifted the mood to up while Chinese Premier Li Keqiang’s optimism surrounding the economy offered extra help to commodity-linked currencies.
Furthering the upside move was the US dollar’s (USD) overall weakness. The greenback had to bear the burden of downbeat manufacturing and housing numbers at home. However, the market’s reaction to the House of Representatives’ impeachment of President Donald Trump seemed to gain a little attention.
Looking forward, the economic calendar has no major data/events scheduled for publishing and hence traders will seek information abroad for fresh impulse. In doing so, trade headlines could keep the driver’s seat.
Technical Analysis
Sustained trading beyond 0.6600 becomes necessary for the pair to challenge early-July bottom near 0.6680. Absence of which will keep the market’s focus on a 200-day Exponential Moving Average (EMA) figure of 0.6525 as the strong support.