NZD/USD slumps to fresh 10-day lows near 0.6660
- NZD/USD is extending its slide after closing in red on Monday.
- US Dollar Index continues to push higher toward 93.50.
- Risk-off market mood weighs on risk-sensitive NZD on Tuesday.
The NZD/USD pair closed the first day of the week in the negative territory and continued to push lower on Tuesday. As of writing, the pair, which touched a fresh 10-day low of 0.6659, was trading at 0.6666, losing 0.35% on a daily basis.
DXY extends rally on Tuesday
The broad-based USD strength and risk aversion seem to be weighing on NZD/USD. On Monday, US President Donald Trump said that they will prohibit federal contracts to US companies that outsource to China and caused US-china tensions to reescalate. Meanwhile, The New York Times reported that the US was considering banning some or all products made with cotton from China’s Xinjiang province.
Reflecting the dismal market mood, major European equity indexes trade in the negative territory and the S&P 500 futures are losing 0.55%.
On the other hand, risk-off flows help the greenback continue to gather strength against its rivals. After closing the fifth straight day in the positive territory on Monday, the US Dollar Index (DXY) preserved its bullish momentum and was last seen gaining 0.33% on the day at 93.36.
The IBD/TIPP Economic Optimism Index will be the only data featured in the US economic docket and the market sentiment is likely to remain the primary driver of NZD/USD's movements.
Technical levels to watch for