Daily Forex Market Preview, 07/02/2018
The equity market selloff extended to the Asian and then to the European session yesterday. However, the selling was subdued towards the U.S. session close. The volatility index (VIX) however remains elevated. The U.S. dollar was little changed on the day.
On the economic front, UK’s services PMI data released yesterday showed a decline in the sector. Overall, with the UK’s manufacturing and construction sectors also coming out weaker, the data indicated that the UK’s economy got off to a subdued start in January. The Bank of England will be meeting this Thursday.
In the overnight session, New Zealand’s unemployment data showed that the unemployment rate fell to 4.5% beating estimates of an increase to 4.7%. The quarterly employment change rose 0.5% which was a slower pace compared to a 2.2% increase in the previous quarter.
Looking ahead, the RBNZ will be holding its monetary policy meeting later this evening. No changes are expected to interest rates at today’s meeting.
NZDUSD 07-02-2018 Intra-day analysis
NZDUSD (0.7306): The New Zealand dollar briefly tested the resistance level at 0.7333 which had previously served as support. The declines off this level could be validated on a close below the previous lows formed at 0.7257. A close below this level will indicate further bearish momentum that will see the Kiwi dollar targeting the next support at 0.7160. To the upside, in the event that NZDUSD closes above 0.7333, the consolidation near the top could continue.