NZD / USD falls as traders watch Chinese inflation data

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New Zealand Dollar, NZD / USD, Westpac Consumer Confidence, China Inflation – Talking Points

Wednesday’s Asia-Pacific Forecast

The New Zealand dollar fell against the US dollar overnight as Wall Street stocks broke a multi-day winning streak. The loss of the NZD / USD came despite the island nation’s bullish economic data. The benchmark S&P 500 lost 0.35% at the closing bell. Nonetheless, US stock indices remain close to their all-time highs following a mostly positive list of corporate earnings. DoorDash shares gained nearly 25% in after-hours trading after the food delivery service reported pink profits as well as a business acquisition.

Treasuries caught an offer, pushing yields down across the curve. The yield on the benchmark 10-year note fell to its lowest level since September 24 at 1.415%. A basic reading of the October Producer Price Index (PPI) missed expectations at 0.4% m / m against the expected increase of 0.5%. Investors continue to monitor the threat of global inflation. Today, the Chinese inflation data intersect.

Speaking of inflation, crude oil prices are on the rise after the American Petroleum Institute (API) reported a surprise draw in US oil inventories. Crude oil inventories fell 2.49 million barrels for the week ending Nov. 5, according to API data. Energy traders will watch tomorrow’s EIA report for confirmation, but for now the bulls are in firm control of the data.

This morning, Australia’s Westpac released data on consumer confidence. The November index rose / fell to 105.3 from 104.6 in October. This follows a decline in Covid restrictions across Australia, with vaccination rates reaching levels high enough to warrant easing measures. The bullish figure bodes well for the country entering this week’s jobs report due out on Thursday.

Technical forecast NZD / USD

NZD / USD fell below its rising 20-day Simple Moving Average (SMA) overnight before pressure eased at the start of the APAC session. The 26-day Exponential Moving Average (EMA), along with the confluent psychological resistance of 0.71, prevented a deeper bearish move. Prices may fall between these two moving averages during today’s session if volatility reappears.

8 hour chart NZD / USD

Chart created with TradingView

— Written by Thomas Westwater, Analyst for DailyFX.com

Contact Thomas, use the comments section below or @FxWestwateron Twitter

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