NZD/USD: bears testing key levels to the downside, where next?
- NZD/USD: bulls giving in below the 10-D SMA.
- NZD/USD: eyes on 200-D SMA.
NZD/USD opened around 0.7310 with a bearish vibe pressuring the Kiwi below the 21 and 10-D SMAs on Thursday, correcting the double bottom recovery from 0.7180. Currently, NZD/USD is trading at 0.7275, down -0.02% on the day, having posted a daily high at 0.7283 and low at 0.7274.
The bird is pressured as the dollar picks up a bid and a more sedate pace of local growth clips its wings at the same time that the US short-term yields are rising and commodity prices are falling. "Expect downward pressure to be maintained as interest rate differentials come into focus next week (hiking US Fed and on-hold RBNZ)," analysts at ANZ explained.
Key data improvements in US
In data, the US sessions were kind to the dollar in terms of economic releases with both Import Prices and Jobless Claims were positive while the Empire Manufacturing data was also better than expected. From a fundamental point of view, Kudlow's appointment as head of National Economic Council was taken as moderating influence on Trump's trade stance. However, there was news that Mueller has subpoenaed the Trump Organization made for a bout of risk-off in NY, pressuring the higher betas further. The Business NZ PMI arrived as 53.4 vs 55.6 prior. China's March TR IPSOS PCSI comes as next data in Asia
NZD/USD levels
Technicals lean bearish again with the price testing below the cloud top and aforementioned DMAs with RSI's biased to the downside as well. Closes need to occur above 0.7320 with the 21-D SMA falling in at 0.7300 as the first major hurdle. 0.7360 is the next key upside target in the near term to open a run towards 0.7435 daily high double top. To the downside, the double bottom lows (0.7310/20) ahead of the 200-D SMA are key.