NZD/USD: 0.7310 to hold in the coming session?
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- NZD/USD attempting to correct away from the key 0.7310 level.
- NZD/USD bulls slightly relieved on recent retail sales data.
NZD/USD has taken a walk tot he downside, piercing the ascending 21-hr SMA at 0.7330 and the move is significant as it has broken the ascending channel's recovery trend. Currently, NZD/USD is trading at 0.7340, down -0.01% on the day, having posted a daily high at 0.7347 and low at 0.7327.
Global market snapshot: US bond market recovered losses - ANZ
NZD/USD has been in a strong downtrend since Friday's closing in Asia where bears capped the reversal of the end of January's downside to 0.7180, or thereabouts, where bulls took charge up to 0.7436.
NZ retail sales for Q4 beat
The recent downtrend made it to 0.7307 after the FOMC minutes yesterday before the bird recovered to 0.7364 on today's dollar weakness/ lower US yields which remain dominant for this pair in the absence of any significant domestic events/data. We have recently had the release of NZ retail sales for Q4 (+1.7% q/q (expected +1.4%)) making a marginal bid in the Kiwi vs an otherwise better-offered environment.
NZD/USD levels
The key topside resistance line is made up from 0.7436 (Jan 23rd high) 0.7419 (30th Jan high), and 0.7379 (13th Feb high). The next key resistance levels, should the 0.7310 support level hold, will be the 0.7435/40 triple top level ahead of 0.7557, 21st July 2017 high. 0.7310 guards 0.7280 and 0.7180.
Analysts at UOB Group explained recently that 0.7435/40 is key would indicate that a move towards 0.7500 (and possibly beyond) has started. "The odds for such a move are not high at this stage but would continue to improve as long as the key 0.7310 support is not taken out in the next few days”.
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