- NZD / USD lost its traction after climbing above 0.7050.
- The US dollar index registered a modest rally at the beginning of the US session.
- Wall Street appears to start the day in negative territory.
The NZD / USD It started the new week on a firm footing and rose to its highest level since June 2018 at 0.7052. With the dollar starting to find some demand ahead of the US session, the pair lost its bullish momentum and was last seen gaining 0.18% on the day at 0.7035.
DXY recovers modestly
The general weakness of the USD allowed the NZD / USD to rise on Monday. In the absence of significant fundamental drivers, the US Dollar Index (DXY) extended last week’s slide and hit its lowest level in 32 months at 91.55.
However, renewed concern that the EU and the UK would fail to reach a trade deal helped the dollar gain traction against its rivals and forced the NZD / USD to change direction. At the moment, the DXY is down 0.13% on the day at 91.65.
Later in the session, the ISM Chicago PMI, the Federal Reserve Bank of Dallas Manufacturing Companies Index and pending US home sales data will be seen to give further momentum. There will be no release of macroeconomic data from New Zealand on Tuesday.
Meanwhile, S&P 500 futures were down 0.25% on the day. End-of-the-month flows could send major equity indices down sharply and help the USD gain additional strength in the second half of the day.
Technical levels
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