NZD: Asia Wrap - NZD Back Above 0.6000
The NZD/USD had a range of 0.5963 - 0.6014 in the Asia-Pac session, going into the London open trading around 0.6005. The NZD has remained well supported all through the Asian session, +0.50%. With the USD back under pressure the NZD very quickly finds itself back on a 0.6000 handle, looking to build momentum for a test of the 0.6100 area.
- "NZ TREASURY: MAINTAINING ECONOMY MOMENTUM MAY BE CHALLENGING" - BBG
- “Among Group-of-10 commodity currencies, the Kiwi “is the only energy importer and most vulnerable if Middle East oil supply is impacted more severely,” wrote Bank of America.”
- A huge bounce from sub 0.5900 and we are again breaking back above the 0.6000 area this morning.
- Technically while the support around 0.5850 holds in NZD/USD it is still in an uptrend, this held perfectly overnight and should risk build on from this then focus will turn once gain back to 0.6050/0.6100.
- Options : Closest significant option expiries for NY cut, based on DTCC data: none. Upcoming Close Strikes : 0.5690(NZD621m June 25)
- CFTC Data showed Asset managers paring back their shorts slightly once more over the week, the leverage community did likewise.
- AUD/NZD range for the session has been 1.0798 - 1.0817, currently trading 1.0805. The cross is struggling to get any momentum back above 1.0800 for now, it needs to hold above here and start extending higher to put a higher low in place. The longer it fails to extend the higher the chances it begins to drift lower again, a break sub 1.0750 will see downward momentum return.
Fig 1: NZD/USD Spot Daily Chart
Source: MNI - Market News/Bloomberg Finance L.P
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