NZD : Strong USD

(Tue, 12 Jan 2021). Wall Street moved lower during Monday’s US trading session as investors reevaluate government regulatory risks to technology stocks following last week’s chaos on Capitol Hill. The tech-heavy Nasdaq Composite led the move lower with a 1.25% drop. The S&P 500, Dow Jones, and Russell 2000 also sold off with losses of 0.66%, 0.29%, and 0.03%, respectively.

Investors are mulling over future regulator actions from government agencies against technology companies. Twitter dropped over 6% following the company’s suspension of President Trump’s account. Many US lawmakers have voiced support for increasing regulation on social media platforms, a move that now appears to have more backing than ever.

Investors also moved away from US government bonds, extending last week’s selloff with the 10-year yield rising to 1.150%, a new multi-month high. The move is likely reflective of the incoming Biden administration’s higher chances for increased fiscal stimulus following the runoff Georgia Senate elections last week. Traditionally, bonds move inversely with equities, but markets are betting on a flood of new Treasury issuances to fund future stimulus efforts.

NZD/USD TECHNICAL OUTLOOK:

The New Zealand Dollar dropped over 1% against the US Dollar on Monday, with NZD/USD slicing below the psychologically important 0.7200 level. Prices appear to be finding some support at the 50% pseudo-Fibonacci retracement level from the late December low – January high. The MACD histogram plotting back to its zero line, which may hint at easing downside momentum.

DISCLAIMER ON

GFS ASIA TEAM

• 0
• 0
• just now
• 0