Today’s sell-off in the U.S. equity markets is putting downsidepressure on the NZD USD. The current weakness however has not beenenough to change the trend to down on the daily or weekly charts.
Today’s sell-off in the U.S. equity markets is putting downside pressure on the NZD USD. The current weakness however has not been enough to change the trend to down on the daily or weekly charts.
Demand for risk has been dropping since last Friday when the U.S. Non-Farm Payrolls Report showed an improving U.S. economy. Since then traders have been slowing liquidating long positions in the NZD USD.
The trading activity to the downside has been steady and consistent. This could mean that sellers are just lightening up as they await more direction from the Fed regarding U.S. interest rates and monetary policy. This report is due Wednesday afternoon.
The daily chart indicates this market is nearing a short-term retracement zone. The daily range is .6475 to .6817. This sets up a retracement zone at .6646 to .6606. Watch for a possible technical bounce to the upside following a test of this level.
The weekly chart indicates the possibility of an even further decline once the low at .6589 is penetrated.