NZD/USD Flirts with 100-DMA Support Near 0.6730

NZD/USD Flirts with 100-DMA Support Near 0.6730

19 May 2016, 08:04
Roberto Jacobs
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NZD/USD Flirts with 100-DMA Support Near 0.6730

The NZD/USD pair keeps the ongoing bearish momentum intact and now tests weekly lows amid broad based USD strength and oil-price sell-off.

NZD/USD hovers around 100-DMA

Currently, the NZD/USD pair trades -0.18% lower at fresh session lows of 0.6726, where 100-DMA coincides. The Kiwi extends losses for the second straight session, as the sentiment remains soured amid weaker NZ fundamentals and lower commodities’ prices,
particularly oil. The recent NZ Input Producer Price Index (PPI) fell 1.0% during the March quarter, against expected 0.3% rise in the first quarter. The Output PPI fell 0.2% in the first quarter, following a decline of 0.8% in the October.

Moreover, the pair remains vulnerable amid rising demand for the greenback, following a hawkish tone reflected by the FOMC April meeting minutes. The minutes revealed that the Fed officials are ready for a June rate hike, but may watch out for June NFP and CPI figures to take a call on the interest rate decision.

Nothing of note for the major in the day ahead, except for the US unemployment claims and Philly Fed manufacturing index. Hence, Fed speaks will be closely heard for fresh moves in the USD.

NZD/USD Levels to consider

To the upside, the next resistance is located at 0.6771/79 (5 & 10-DMA), above which it could extend gains to 0.6800 (round number). To the downside immediate support might be located at 0. 6700 (round number) and from there to at 0.6657 (200-DMA).


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