The New Zealand Dollar (NZD) traded near the 0.5790 level against the US Dollar (USD) on Monday, showing limited recovery despite a modestly weaker Greenback following disappointing US economic data [1]. US Durable Goods Orders for June increased by just 0.3% month-over-month, significantly missing the market forecast of 1.6% and following a revised 4.0% decline in May [1]. However, underlying business demand appeared more resilient, with orders excluding transportation rising 0.6% and orders excluding defense up 0.3% [1].
The softer headline reading on US Durable Goods Orders curbed demand for the USD, but the impact on NZD/USD was modest as investors remained cautious ahead of the upcoming Federal Reserve monetary policy decision [1]. The NZD found some support from a sharp decline in oil prices, which benefits New Zealand's economy due to its reliance on imported fuel [1].
Technical analysis indicates that NZD/USD maintains a bearish near-term bias, trading at 0.5779 and remaining capped beneath both the 20-period and 100-period Simple Moving Averages, which act as immediate resistance at 0.5790 and 0.5782, respectively [1]. The Relative Strength Index (RSI) at around 39 suggests downside momentum persists, with initial support at 0.5771 and further resistance levels at 0.5786, 0.5794, and 0.5800 [1].
Looking ahead, market participants are focused on upcoming US data releases, including the ADP Employment Change four-week average, the US Housing Price Index, and July Consumer Confidence, all of which could influence sentiment before the Federal Reserve's decision on Wednesday [1].
CONCLUSION
The NZD/USD pair remains under pressure despite weaker US economic data and lower oil prices providing some support. Investors are cautious ahead of key US data releases and the Federal Reserve's policy decision, with technical indicators pointing to a bearish outlook in the near term.