NZD/USD turns positive on China coronavirus vaccine news

• NZD/USD rises from 0.6406 to 0.6430, tracking the recovery in the US stock futures.
• The Covid-19 vaccine from China shows positive results in human trials.
• NZD's upside may be capped by RBNZ's dovish stance, 

NZD/USD is now flashing green with the risk assets getting a lift from encouraging news related to coronavirus vaccine.

The currency pair is trading near 0.6430 at press time, representing a 0.17% gain on the day, having put in a low of 0.6406. Meanwhile, the S&P 500 futures are reporting a 0.30% gain compared to a 0.5% decline seen in early Asia. 

A Covid-19 vaccine candidate developed by Chinese biopharmaceutical firm CanSino Biologics Inc in conjunction with a military research team has shown positive results in early human trials. 

The company said on Sunday that all 1,120 volunteers in the phase-1 and phase-2 clinical trials produced high-titer antibodies against the coronavirus after accepting two doses of the vaccine, according to Global Times. The vaccine is currently limited to military use and cannot be expanded to a broader vaccination range without further government approval. 

While the NZD and S&P 500 futures are currently cheering the positive phase-1 and phase-2 results are boding well, the challenge lies in sustaining gains. A couple of US pharma companies published similar results over the past two months but failed to provide a sustainable boost to risk assets. 

In addition, dovish comments by the Reserve Bank of New Zealand's governor Orr could cap upside in the NZD/USD pair. Orr was out on the wires a few minutes ago, stating that the easy policy will remain in place for some time. 

Technical levels