NZD/USD: consolidating in a tight range, awaiting Friday's showdown

NZD/USD has been consolidating in a tight range as the market remains somewhat thin due to the 4th July holidays and traders preferring to cross their arms ahead of the nonfarm payrolls event. NZD/USD was pretty much unfazed by the cautious tone surrounding the FOMC minutes and sits pretty tucked in just below the 0.68 handle at 0.6787 currently.

NZD/USD has made a high of 0.6798 overnight, having drifted steadily higher in markets from 0.6750.  As analysts at ANZ noted that the FOMC minutes passed by without too much fanfare, although there were a couple of elements (trade uncertainty and yield curve shape) that participants are watching. "Ultimately though, trading ranges have again been tight and we expect that to remain the case today ahead of tonight’s non-farm payrolls release," the analysts argued. 

All eyes on Friday's showdown

Meanwhile, all eyes are set on not only the nonfarm payrolls showdown but indeed, there are plenty of cautionary tones in the market around the Chinese/EU and US tariff wars where US/China tariffs are due to kick in tomorrow. However, there have been somewhat sweetened headlines that a U.S. official reportedly offered a “zero solution” to car tariffs that could see the U.S. stop its threats to impose such duties in exchange for the European Union eliminating its levies.

Nonfarm Payroll preview: tariffs could overshadow employment data

NZD/USD levels

0.6680 is the key support while 0.6850 is the first key upside target on a continuation of the reversal through the 200-hr SMA at 0.6785 where the price is holding above. Only a break above 0.6850 would alleviate the downside pressures and eyes remains towards 0.6675. On the wide, while below the key 200-month moving average resistance at 0.7007 longer term technicals remain bearish.