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NZD/USD bounces towards 0.6100 after US labor market data

  • The NZD/USD pair jumped above 0.6090 showing a 0.95% rise on the day.
  • Initial claims for US jobless benefits for the week ending June 2 rose to 261,000.
  • Falling US yields amid dovish bets on the Fed weakened the dollar.

The pair NZD/USD saw a significant rally, breaking above the 0.6090 level and marking a 0.95% gain on the day. This rise was influenced by multiple factors, including initial US jobless claims for the week ending June 2, which unexpectedly accelerated, fueling subdued expectations ahead of the next Federal Reserve meeting. (Fed). The dollar lost interest due to the drop in US bond yields.

US bond yields fall on jobless claims data, eye on CPI

Initial US jobless claims for the week ending June 2 stood at 261,000, versus 235,000 expected, and accelerated from its previous reading of 233,000. The increase in the number of people applying for unemployment benefits in the US points to the weakness of the labor market amid the tightening monetary policy of the Federal Reserve (Fed), which makes investors anticipate a less aggressive stance for the next meetings. CME’s FedWatch tool suggests investors are more likely to see the Fed refrain from raising rates at its next meeting, scheduled for June 13-14, and instead keep the rate target stable at 5.25%. .

Against this background, US bond yields fell across the curve, with 2-, 5-, and 10-year rates falling.

The upcoming US Consumer Price Index (CPI) data is expected to play the most crucial role in determining the Fed’s decision. Analysts expect the year-on-year inflation rate to drop to 4.2 % in May, up from 4.9% prior, while the core rate will rise to 5.6%, up from 5.5% previously.

NZD/USD levels to watch

According to the daily chart, the NZD/USD pair maintains a neutral to bearish outlook in the short term. Despite the technical indicator showing increasing bullish momentum, the bearish cross made by the 20-day SMA dipping below the 200-day SMA suggests that the negative outlook for the NZD is intact.

On the downside, support levels line up at 0.6050, 0.6030 and the key psychological level of 0.6000. On the other hand, immediate resistance is seen at 0.6115, followed by the 0.6130 – 0.6150 zone, where the aforementioned SMAs traced the bearish crossover.

NZD/USD daily chart


Last price today 0.6095
Today Change Daily 0.0058
today’s daily variation 0.96
today’s daily opening 0.6037
daily SMA20 0.6138
daily SMA50 0.6194
daily SMA100 0.624
daily SMA200 0.6149
previous daily high 0.6097
previous daily low 0.6031
Previous Weekly High 0.6112
previous weekly low 0.5985
Previous Monthly High 0.6385
Previous monthly minimum 0.5985
Fibonacci daily 38.2 0.6056
Fibonacci 61.8% daily 0.6072
Daily Pivot Point S1 0.6013
Daily Pivot Point S2 0.5989
Daily Pivot Point S3 0.5947
Daily Pivot Point R1 0.6079
Daily Pivot Point R2 0.6121
Daily Pivot Point R3 0.6145

Source: Fx Street

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