NZD/USD turns red as traders eye US election results
- The NZD/USD is in the red today as traders focus on the United States election.
- Early results show that the race between Joe Biden and Donald Trump will be tight.
- New Zealand also released better-than-expected jobs numbers.
The NZD/USD pair is down by more than 0.50% as traders react to the streaming results from the United States and the employment numbers from New Zealand. The pair is trading at 0.6655, which is lower than the overnight high of 0.6745.
New Zealand unemployment rate rises
New Zealand has been among the best countries in managing the coronavirus pandemic. The country, which has a population of more than 5 million people has recorded just 1,970 cases and 25 deaths. That is impressive considering that Australia, its neighbour, has had more than 27,000 cases.
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However, like all countries, New Zealand has been affected by the pandemic, especially in its travel and hospitality industry. That is because the pandemic has brought down the lucrative tourism sector.
Today, employment data from New Zealand showed that the number of unemployed people in the country rose by 37,000 to 151,000. That was a 32.5% increase from the second quarter and is evidence of the challenging state of the economy. At the same time, there were 22,000 fewer employed people in the quarter.
In total, the important unemployment rate rose from 4.0% to 5.3%, its biggest quarterly jump on record. That increase was better than the 5.4% analysts were expecting. Also, it is significantly better than the US rate of 7.7% and Europe’s 7.6%. In a statement, the statistics office said:
“Last quarter’s low unemployment rate of 4.0 percent was explained in part by people’s inability to be ‘actively seeking’ and available for work during the national lockdown that was in place for much of the quarter.”
Meanwhile, underutilisation increased to 13.2%, up from the second quarter’s 12.0%. This number includes the number of unemployed people, underemployed people, and the potential labour force.
Separately, the NZD/USD is also reacting to the streaming results of the American presidential election. As of this writing, President Trump has won 107 votes while Biden has won 131. Still, the final vote could change as more colleges release their results.
NZD/USD technical outlook
The daily chart shows that the NZD/USD price is in the red today. However, the price remains in the ascending channel that is shown in blue. It is also above the 25-day and 15-day exponential moving averages and above the 78.6% Fibonacci retracement level. Therefore, at this stage, because of the American election, the pair will likely move in either way. As such, the key support and resistance levels will be at 0.6513 and 0.6761, respectively.