NZD/USD drops sharply to test NY lows near 0.7030

The overnight recovery in NZD/USD lost legs just shy of 50-DMA barrier at 0.7080 post-Tokyo open, now pushing the rate closer towards 5-DMA placed at 0.7019.

NZD/USD looks to test 0.70 handle

Currently, the NZD/USD pair drops -0.24% to 0.7038, flirting with NY lows posted at 0.7032. The Kiwi failed once again near 50-DMA and dropped sharply over the last hours, mainly driven by strong gains in the AUD/NZD cross, following somewhat upbeat Aus CPI data.

The selling pressure behind the Kiwi can be also justified by lower oil prices and mixed sentiment on the Asian equities, which dampens the sentiment around the higher-yielding currency NZD. While the major also shrugged-off auspicious industrial profits data from China, New Zealand’s top export destination.

Looking ahead, the major will continue to track the persistent risk trends in the markets ahead of the US macro updates and Fed decision due later today.

NZD/USD Levels to consider

To the upside, the next resistance is located at 0.7080 (50-DMA), above which it could extend gains to 0.7120 (Jul 19 high). To the downside immediate support might be located at 0.6962 (100-DMA) and from there to at 0.6900 (round figure).