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Forex Market: NZD/USD hits a fresh 86-week high despite cooling COVID-19 vaccine optimism

NZD/USD rose on Wednesday and hit a fresh 86-week high, despite that concerns over surging new COVID-19 infections tempered market optimism over vaccine progress.

“Further positive vaccine-development news is still expected over the next few days or weeks, and it does lower the downside risk to global growth,” Citi strategist Johanna Chua said.

“But near-term sentiment may still get clouded by the harsh winter in the west because of the resurgence in COVID cases.”

A surge in new infections has led to record hospitalizations and new restrictions on gathering in the United States.

At the same time, authorities in Japan, South Korea and Australia are trying to deal with new outbreaks of the disease.

As of 9:08 GMT on Wednesday NZD/USD was gaining 0.53% to trade at 0.6928, after earlier touching an intraday high at 0.6929, or a level not seen since March 21st 2019 (0.6939). The pair has extended gains to 4.74% so far in November, following a mere 0.03% dip in October.

In terms of economic calendar, today market players will be paying attention to the monthly data on US housing starts for October due out at 13:30 GMT.

Additionally, several Fed officials are expected to make speeches.

Bond Yield Spread

The spread between 1-year New Zealand and 1-year US bond yields, which reflects the flow of funds in a short term, equaled 10.5 basis points (0.105%) as of 7:15 GMT on Wednesday, down from 11.5 basis points on November 17th.

Daily Pivot Levels (traditional method of calculation)

Central Pivot – 0.6895
R1 – 0.6915
R2 – 0.6939
R3 – 0.6959
R4 – 0.6978

S1 – 0.6871
S2 – 0.6852
S3 – 0.6828
S4 – 0.6804 is a financial media specialized in providing daily news and education covering Forex, equities and commodities. Our academies for traders cover Forex, Price Action and Social Trading.

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