NZD/USD jumps to test 0.6870 post-NFP, eyes on China CPI
|- Risk-on, better China trade support.
- Takes-out key resistance near 0.6865.
- DXY drops on weak wage growth.
The NZD/USD pair caught a fresh bid-wave and broke higher the European range-trade to test the key confluence zone near 0.6865 levels after the US dollar met fresh supply across its main competitors on mixed US jobs data release.
NZD/USD: Bulls regain poise
Despite the recent upmove in the spot on the back of weak wage growth numbers in the US labor market report, the prices remain confined within a 60-pips tight range over the last week, awaiting the outcome from FOMC meeting next week for the range breakout.
Meanwhile, the Kiwi trades with sizeable gains heading towards the US open, underpinned by the risk-on rally in the European equities, subdued Treasury yields, and better-than-expected Chinese trade data.
However, it remains to be seen if the pair can regain 0.69 handle, as investors remain somewhat cautious ahead of the Chinese inflation numbers due tomorrow, with the reaction on the NZD expected on Monday morning. China is New Zealand’s top trading partner.
In the meantime, the pair awaits the release of the US prelim consumer sentiment data for fresh USD moves, eventually impacting the spot.
NZD/USD Levels to consider
The spot trades above 0.6850 (psychological levels), below which 0.6808/07 (classic S1/Fib S2) and 0.6780 (multi-month lows) are key near-term downside areas. To the topside, a break above 0.6900 (round number) could open doors towards 0.6921 (50-DMA).
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