Yen Holds Steady, GBP and NZD Fall Due to Shaky Investor Confidence

At the time of writing in today’s currency markets, the Dollar has surpassed the Yen as the most powerful currency. Despite modest improvement, the main focus in the financial markets remains shaky. The New Zealand Dollar is currently the worst, but it is catching up with others; Sterling is also weak, as the selloff in crosses deepens.

After the big risk-off trades in the US in the prior day, investor confidence has calmed. The yen and the Swiss franc have pared some of their gains, but they remain the two most powerful currencies. Commodity currencies, led by the Canadian Dollar, are the weakest. For the time being, the dollar and the euro are intermingled, caught in the middle. Concerns about COVID-19 delta variants will continue to be the focus of attention.

The New Zealand dollar (NZD/USD) has finally followed the lead of other commodity currencies and broken out to the downside today. Overall, risk aversion outnumbers expectations of a rate hike by the Reserve Bank of New Zealand. The drop from 0.7463 is viewed as a correction to the entire uptrend from 0.5467. As long as the 0.7104 barrier holds, the outlook will be bearish. Before completion, the next aim is a 100 percent prediction of 0.7463 to 0.6942 from 0.7315 at 0.6794.

Yen Holds Steady After Pairing Gains

Profit-taking is likely to have played a role in the bid, given the massive sell-off at the start of the week. EUR/JPY is on the rise as traders get back behind the US stock market in a somewhat stronger risk mood on Tuesday.

Because of its large beta, the cross is benefiting as investors begin to rationalize that fears of another crushing round of worldwide lockdowns may be unfounded. The bulls, on the other hand, are solidifying and digging in their claws at the time of writing. This might lead to a breakthrough of the present resistance level of 129.50. A breach and finish beyond 129.50 might be positive, forming the following bullish formation.

This year, virus resurgences appear to be the key driver of market movements in several areas. In reaction to the recent increase in instances, Japanese officials have declared a state of emergency in Tokyo and prohibited spectators from the Olympics. The yen has moved in lockstep with new Japanese case counts