NZD/USD – Kiwi Dips, US Jobless Claims Sparkles

NZD/USD has posted losses on Thursday, as the pair is trading at 0.6940 in the North American session. On the release front, New Zealand Visitor Arrivals gained 4.1%, while Credit Card Spending improved 4.8%. In the US, Unemployment Claims slid to 245 thousand, well below expectations. However, the Philly Fed Manufacturing Index posted a decline of 1.8 points, much lower than the estimate.

It’s been a volatile week for the New Zealand dollar. The pair started the week with gains of 140 points, but has since retracted and given up close to 100 points. On Tuesday, NZD/USD punched above the symbolic 70 line, its highest level since 2015. The New Zealand dollar received a boost as key indicators performed well. CPI rebounded in the first quarter with a small gain of 0.2%. This edged above the forecast of 0.1% and was a strong improvement over the fourth quarter reading of -0.5%. The New Zealand central bank has been under some pressure to lower interest rates due to weak inflation levels, so this positive CPI reading affords the central bank some breathing room in this regard. There was more good news from the New Zealand Dairy Auction, which posted an excellent gain of 3.8%. This was the strongest gain since October 2015.

The US labor market continues full steam ahead, as the weekly unemployment claims indicator fell to 247 thousand, well below the forecast of 265 thousand. This was the lowest weekly count since November 1973, and the four-week indicator, which is considered more accurate, also dropped compared to the previous release. The good news was tempered by a disappointing key manufacturing report. The Philly Fed Manufacturing Index surprised the markets with a decline of -1.6 points, as the estimate stood at 8,1 points. This reading marked the third decline in four readings, as the manufacturing sector remains a weak area of the US economy. Uncertainty in global economic conditions has lead to weaker demand for US goods and put the squeeze on domestic manufacturers.

NZD/USD Fundamentals

Wednesday (April 20)

  • 18:45 New Zealand Visitor Arrivals. Actual 4.1%
  • 23:00 New Zealand Credit Card Spending. Actual 4.8%

Thursday (April 21)

  • 8:30 US Philly Fed Manufacturing Index. Estimate 8.1. Actual -1.6
  • 8:30 US Unemployment Claims. Estimate 265K. Actual 247K
  • 9:00 US HPI. Estimate 0.4%. Actual 0.4%
  • 10:00 US CB Leading Index. Estimate 0.4%. Actual 0.2% 
  • 10:30 US Natural Gas Storage. Estimate 6B. Actual 7B 

*Key releases are highlighted in bold

*All release times are EDT

NZD/USD for Thursday, April 21, 2016

NZD/USD April 21 at 10:50 EDT

Open: 0.6975 Low: 0.6922 High: 0.6983 Close: 0.6939

NZD/USD Technical

S3 S2 S1 R1 R2 R3
0.6621 0.6738 0.6897 0.7011 0.7100 0.7231
  • NZD/USD has shown limited movement in the Asian and European sessions. The pair has posted slight losses in North American trade
  • 0.6897 is providing support
  • There is resistance at 0.7011

Further levels in both directions:

  • Below: 0.6897, 0.6738 and 0.6621
  • Above: 0.7011, 0.7100, 0.7231 and 0.7322
  • Current Range: 0.6897 to 0.7011

OANDA’s Open Positions Ratio

The NZD/USD ratio has shown movement towards long positions on Thursday. Long positions currently have a majority (54%), indicative of trader bias towards NZD/USD reversing directions and moving to higher ground.

This article is for general information purposes only. It is not investment advice or a solution to buy or sell securities. Opinions are the authors; not necessarily that of OANDA Corporation or any of its affiliates, subsidiaries, officers or directors. Leveraged trading is high risk and not suitable for all. You could lose all of your deposited funds.

Kenny Fisher

Kenny Fisher

Currency Analyst at Market Pulse
Kenny Fisher joined OANDA in 2012 as a Currency Analyst. Kenny writes a daily column about current economic and political developments affecting the major currency pairs, with a focus on fundamental analysis. Kenny began his career in forex at Bendix Foreign Exchange in Toronto, where he worked as a Corporate Account Manager for over seven years.