NZD/USD Price Analysis: Prints fresh two-week low around 0.6110 as Chinese economy worsens further
- NZD/USD has refreshed its two-week low at 0.6113 amid a bleak outlook for China.
- Investors have turned risk-averse ahead of the speech from Fed Jerome Powell.
- NZD/USD is consistently forming lower highs, which indicates that investors are capitalizing on each pullback as a selling opportunity.
The NZD/USD pair has printed a fresh two-week low at 0.6113 in the early European session. More downside in the Kiwi asset is anticipated as Chinese economic prospects are worsening further due to bleak demand and weak exports.
China’s National Bureau of Statistics (NBS) reported that corporate profits contracted 12.6% in May above an 18.2% drop in April due to weak households demand. It is worth noting that New Zealand is one of the leading trading partners of China and the weak economic outlook of China would be weighing pressure on the New Zealand Dollar.
S&P500 futures are showing caution despite a bullish settlement on Tuesday. Investors have turned risk-averse ahead of the speech from Federal Reserve (Fed) chair Jerome Powell to assess the interest rate guidance.
The US Dollar Index (DXY) is struggling to keep stability above the immediate resistance of 102.60.
NZD/USD is consistently forming lower highs on a two-hour scale, which indicates that investors are capitalizing on each pullback as a selling opportunity. The Kiwi asset has been failing to auction above the 200-period Exponential Moving Average (EMA) at 0.6160, which portrays that the long-term trend is bearish.
Action in the Relative Strength Index (RSI) (14) indicates that 60.00 is a barricade and territory below 40.00 is consistently tested. This conveys that the bullish momentum is active.
Further downside below the intraday low at 0.6113 will expose the asset to June 05 low at 0.6041. A slippage below the latter would expose the asset to psychological support at 0.6000.
Alternatively, a confident break above May 17 high at 0.6261 will drive the Kiwi asset toward May 19 high at 0.6306 followed by May 08 high around 0.6360.