High-yielding currencies took more hits against the Greenback during today’s Asian session trading.
Will today’s releases turn the tides for NZD/USD?
If you’ve missed the last couple of hours of trading, then here’s a list of the top headlines from the late U.S. and early Asian sessions:
- Fed’s Quarles says he is optimistic about outlook for U.S. economy
- Fed’s Evans says he expects 2% inflation by 2023, but no rate hikes
- Fed’s Rosengren says economy is more fragile than data suggests
- Powell: we’ve “done basically all of the things that we can think of”
- Trudeau pledges to create 1 million jobs, make ‘significant’ investment in child care in throne speech
- NZ: Export boom and import plunge drives big trade surplus
- Australia to overhaul bankruptcy laws to help firms over COVID-19
- Australian Treasurer Josh Frydenberg sets 6% threshold in recovery plan
- BOJ Kuroda stresses readiness to ease further, warns of high uncertainty
- Some in BOJ warned pandemic could delay Japan’s recovery – July minutes
- China’s slow consumption recovery upset by wary low-income households
- Asian shares tumble as global recovery hopes falter
- Australia, New Zealand dollars crippled by rate-cut bets, weak risk appetite
Upcoming Potential Catalysts on the Economic Calendar:
- SNB’s policy decision at 7:30 am GMT
- ECB’s economic bulletin at 8:00 am GMT
- Germany’s IfO business climate at 8:00 am GMT
- U.S. initial jobless claims at 12:30 pm GMT
- BOE’s Bailey to give a speech at 2:00 pm GMT
What to Watch: NZD/USD
With no other major data scheduled, it’s likely that the majors will dance to the tune of market risk sentiment for another day.I’m keeping my eye on NZD/USD, which has reached a key range support and is sporting an oversold Stochastic signal on the 4-hour time frame.
If we see optimistic statements or pledges of more stimulus from both Powell and Mnuchin today, then some Kiwi bulls could come out of their “hi-BEAR-nation” and push the comdoll higher. The .6600 handle is a good target if you consider NZD/USD’s average daily volatility of 66 pips.
If risk aversion continues to drag on the higher-yielding bets, though, then NZD/USD could finally break below its 4-hour range and maybe revisit previous areas of interest near .6500 or .6450.