- US dollar pulls back as Wall Street turns positive.
- Tensions across financial markets remain on the table.
- NZD/USD rebounds modestly, bearish bias persists.
The NZD/USD bottomed during the American session at 0.6222, the lowest level since June 2020 and then rebounded modestly to 0.6266, trimming losses. The dollar moved off high across the board but stays firm amid a volatile financial market.
A recovery in equity prices in Wall Street helped NZD/USD. After a negative opening, the S&P 500 turned positive. Risk aversion is still dominant amid fears about the global economic outlook with higher interest rates ahead.
Data from the US showed the Producer Price Index slowed down from a multi-decade high of 11.5% to 11% in March (annual); on a monthly basis, it rose 0.5%. Jobless claims showed a mixed picture: Initial Claims hit an 11-week high at 203K while Continuing Claims dropped to 1.343M, the lowest since 1970.
The bearish pressure remains in place, and more losses seem likely while under 0.6275. The 20 Simple Moving Average in four hours chart is located at 0.6300; if the kiwi rises above, it would alleviate the short-term negative momentum. The next resistance is seen at 0.6335.
On the flip side, a slide under 0.6235 would expose the 0.6222 low. The following support might be located at 0.6190 (Feb 2020 low) and 0.6160.