NZD/USD cuts through 0.71 on McDermott’s dovish comments

NZD/USD pair breached 0.71 handle and printed a low of 0.7076 after RBNZ’s McDermott called for more monetary easing.

Kiwi trades near 50% Fibo

The spot trades around 0.7080 (50% Fibo of May 30 low – Sep 7 high).  The Kiwi dollar was rejected at 0.7142 as the bid tone around the US dollar strengthened on account of a rise in the treasury yields.

RBNZ’s McDermott called for more easing, expressed concerns regarding inflation in the short-term and thus strengthened the offered tone around NZD, courtesy of which the spot is looking to breach 50% Fibo retracement support.

NZD/USD Technical Levels

Acceptance below 0.7080 (50% Fibo of May 30 low – Sep 7 high) would open doors for 0.7049 (Apr 20 high). A violation there could yield 0.70 handle. On the higher side, resistance is seen at 0.7110 (Oct 7 high) would expose hurdle at 0.7155 (100-DMA) and 0.7176 (38.2% of May 30 low – Sep 7 high).