NZD/USD: Recovery stalled near 0.6550 amid negative equities

By FXStreet FXStreet (Mumbai) – The NZD/USD pair is seen fighting hard to regain lost ground above 0.65 handle, with the recovery running through fresh offers on the back of negative Chinese equities.

NZD/USD faces stiff barrier near hourly 10-SMA at 0.6541

Currently, the NZD/USD pair trades -0.19% lower at 0.6530, having retested daily lows at 0.6510 post-China open. The Kiwi’s recovery from fresh two-month lows appears to lose steam after the negative open on the Chinese indices, once again fuelling risk-off moods across the board. The Shanghai Composite index drops -1.32% while China’s A50 index declines -0.72%.

The below estimates Chinese CPI numbers released over the weekend reinforced worries over the health of the Chinese economy amid crashing local stock markets, and weighs heavily on the NZD/USD pair. China inflation report showed the CPI rising 1.6% y/y in December, coming in weaker than the 1.7% forecast by markets, and well below the government’s target of around 3.0%.

Moreover, concerns over Chinese demand for commodities and at the same time falling copper and oil prices, further exacerbated the pain in the resource-linked Kiwi, with markets speculating further RBNZ rate cut later this month.

NZD/USD Levels to consider

To the upside, the next resistance is located at 0.6571/75 …read more

Source:: FX Street