- NZD / USD rallies from lows of 0.6585 and returns to 0.6635.
- Kiwifruit makes up lost ground as market sentiment improves.
- In the long term, the NZD / USD remains sideways between 0.6600 and 0.6700.
The New Zealand dollar it is cutting losses against the US dollar on Monday, following a three-day drop to lows of 0.6585. Intraday bearish attempts have been contained at 0.6615 and the pair retested the intraday high of 0.6635.
Kiwifruit recovers as market sentiment improves
The market optimism seen on Monday is favoring the risk-sensitive kiwi to cut losses after depreciating more than 1.5% last week. Upbeat figures for China and the US manufacturing activity have offset COVID-19 fears, which has been reflected in strong gains in major stock indices.
Beyond that, a reversal of long dollar positions before the US elections could explain the moderate recovery of some risk assets. With only one day to go before the election, investors are cutting back, skeptical of any predictions about the US election.
NZD / USD remains in a range between 0.6600 and 0.6700
From a technical point of view, the NZD / USD is still trading without a clear direction, trapped between roughly 0.6600 and 0.6700. On the upside, a bullish reaction beyond 0.6670 (Oct 30 high) should extend above 0.6720 (Oct 27 high) before testing key resistance at 0.6795 (Sept 18 high).
On the downside, below 0.6595 (Oct 29 low) bears could boost confidence and target 0.6550 (Oct 8 low) before testing 0.6485 (Aug 20 low).
Credits: Forex Street
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