NZD/USD: Trade deal optimism and challenge to US Pres. Trump highlights 0.6828 resistance

NZD/USD questions the strength of 0.6828 resistance-line early on Tuesday.
Positive sentiment surrounding the US-China trade deal and probe into Trump “obstruction of justice” please the pair buyers.
Break of 0.6828 can flash 0.6855 and 0.6870 with 0.6790 being nearby support to watch during pullback.

Anil Panchal FXStreet

NZD/USD is trading around 0.6825 as traders look to handover to the early Asian session on Tuesday. The pair is near to the descending trend-line resistance that joins highs marked on February 28 and March 01. The recent news report that the US Democrats have launched an "abuse of power" investigation against President Donald Trump strengthened initial upbeat sentiment backed by optimism surrounding a trade-deal between the US and China.

While early Monday news report from Wall Street Journal pleased global trade watchers as it pointed to the US-China trade deal with more positive notes. The sentiment grew stronger during follow-on news that near-zero tariffs from the US and strong IPR protection assurance from China likely paving the way for a successful deal. Additionally, the US President Donald Trump’s jawboning of the Fed’s monetary policy and strength of the US Dollar also played their role in propelling the quote upwards.

Positivity among Kiwi buyers got a boost before Tuesday’s NZ session on announcements from Reuters and Washington Post claiming 81 individuals and entities, including the president’s family, businesses and administration have got letters from the US Democrats demanding documents as the opposition launched an "abuse of power" investigation against the President.

With the Democrats again trying to challenge Trump’s Presidency, probabilities of his resignation regained market attention and dragged the US Dollar further towards the south. As a result, commodities gained additional strength. However, there hasn’t been any comment from Donald Trump which is highly awaited for now.

Given the recent improvements in signals favoring a trade deal between the world’s largest economies and challenges to the USD, traders will closely observe developments surrounding global trade and the US politics in order to determine near-term market moves.

NZD/USD Technical Analysis

Break of 0.6828 resistance-line can propel the quote towards 0.6855 and then to 0.6870 numbers to the north.

In case prices refrain to surpass 0.6828, 0.6790 and 0.6760 can continue gaining sellers’ attention.

Author

Anil Panchal

FXStreet

Anil Panchal has nearly 15 years of experience in tracking financial markets. With a keen interest in macroeconomics, Anil aptly tracks global news/updates and stays well-informed about the global financial moves and their implications.

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