NZD/USD: Sellers catch a breath around 0.6600 ahead of second-tier data
- Risk-on, sluggish data elsewhere favored the US Dollar (USD).
- First quarter manufacturing figures to provide hints for the GDP.
Having witnessed the largest fall in nearly six-weeks, the NZD/USD pair recovers to 0.6600 ahead of first quarter manufacturing sales data during early Tuesday.
The Kiwi pair dropped heavily at the start of the week as markets turned risk-on after the US ditched Mexican tariffs. Adding to the optimism was speculations that trade talks between the US and China will resume soon in G20.
The US Dollar (USD) took advantage of improving risk sentiments and better than forecast JOLTS jobs openings amid sluggish data from China, Italy, and the UK.
Speculations were also on the round that the Reserve Bank of New Zealand (RBNZ) will soon announce another rate cut as a fundamental weakness in the Kiwi economy persists.
To confirm the same today’s first quarter (Q1) manufacturing sales will be observed closely as it will provide the hints for GDP data. Forecasts suggest no change in 2.0% figure flashed during Q4 2018.
At the US, producer price index (PPI) ex-food and energy (YoY) is up for release and may inch up to 2.4% from 2.3% prior during May.
Technical Analysis
A 50-day simple moving average (SMA) near 0.6630 and 0.6680 seem nearby resistances to watch if one wants to aim for 200-day SMA around 0.6710.
On the downside, 0.6560 mark comprising 21-day SMA holds the gate for the quote’s further declines to 0.6500 and 0.6480 numbers to the south.