NZD/USD Technical Analysis: Downbeat China data shifts focus to 50-day EMA support
|- NZD/USD retraces RBNZ-led gains after China data disappoints Antipodeans.
- 100-day EMA, 38.2% Fibonacci retracement limits near-term upside.
- 0.6320 could follow 50-day EMA.
Given the disappointment from China’s data-dump, NZD/USD extends pullback from near-term key resistance confluence as it trades around 0.6390, the intra-day low, while heading into the European open on Thursday.
China’s October month Industrial Production slipped below 5.4% forecast and 5.8% prior to 4.8% while Retail Sales weakened to 7.2% versus 7.9% expected and 7.8% previous readouts. Also adding to the pair’s weakness is a recent comment from the Reserve Bank of New Zealand (RBNZ) Deputy Governor Bascand who said that the economy needs growth to exceed the potential for inflation.
In doing so, a 50-day Exponential Moving Average (EMA) level of 0.6373 acts as immediate support to watch ahead of multiple lows since Friday, around 0.6320, followed by an ascending trend line since October started, around 0.6300.
On the upside, prices need a daily closing beyond 0.6428/30 resistance confluence, comprising 100-day EMA and 38.2% Fibonacci retracement of July-October declines, to aim for monthly top close to 0.6470 and 0.6500 round-figure.
It should also be noted that the pair’s upside past-0.6500 will be challenged by 200-day EMA level of 0.6527.
NZD/USD daily chart
Trend: Pullback expected
Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers.