NZD/USD edges up after Chinese PMI, remains below two-week high set on Wednesday

NZD/USD regains positive traction following the release of a slightly better Chinese PMI.
Worries about slowing economic growth in China and geopolitical risk to cap the Kiwi.
The USD remains supported by the Fed’s less dovish outlook and acts as a headwind.

Haresh Menghani FXStreet

The NZD/USD pair attracts some buyers during the Asian session on Thursday and for now, seems to have stalled the previous day's retracement slide from the 0.6175 region, or over a two-week peak. Spot prices currently trade around the 0.6130-0.6135 zone, though the lack of follow-through buying warrants some caution before positioning for any further appreciating move.

A private-sector survey released earlier today showed that China's factory activity expanded at a steady pace for the third straight month in January. In fact, China's Caixin Manufacturing PMI came in at 50.8 in January, matching the previous month's reading and beating market expectations for a downtick to 50.6. This, in turn, provides a modest lift to antipodean currencies, including the Kiwi, which, along with subdued US Dollar (USD) price action, acts as a tailwind for the NZD/USD pair.

The optimism, however, is likely to remain limited in the wake of a tepid economic recovery in China. Furthermore, the Federal Reserve’s (Fed) less dovish outlook on Wednesday, pushing back against market expectations for a March rate cut, assists the USD to stand tall near its highest level since December 13. Apart from this, geopolitical risks should benefit the Greenback's relative safe-haven status and further contribute to keeping a lid on any further upside for the NZD/USD pair.

Traders now look to the US economic docket, featuring the release of the usual Weekly Initial Jobless Claims data and the ISM Manufacturing PMI. This, along with the broader risk sentiment, might influence the USD price dynamics and provide some impetus to the NZD/USD pair. The focus, however, will remain glued to the closely-watched US monthly employment details, popularly known as the Nonfarm Payrolls (NFP) report on Friday.

Technical levels to watch

NZD/USD

Overview
Today last price	0.6122
Today Daily Change	0.0009
Today Daily Change %	0.15
Today daily open	0.6113

Trends
Daily SMA20	0.6159
Daily SMA50	0.6189
Daily SMA100	0.6058
Daily SMA200	0.6087

Levels
Previous Daily High	0.6175
Previous Daily Low	0.6101
Previous Weekly High	0.615
Previous Weekly Low	0.6061
Previous Monthly High	0.6339
Previous Monthly Low	0.6061
Daily Fibonacci 38.2%	0.6129
Daily Fibonacci 61.8%	0.6147
Daily Pivot Point S1	0.6084
Daily Pivot Point S2	0.6056
Daily Pivot Point S3	0.601
Daily Pivot Point R1	0.6158
Daily Pivot Point R2	0.6204
Daily Pivot Point R3	0.6232

Author

Haresh Menghani

FXStreet

Haresh Menghani is a detail-oriented professional with 10+ years of extensive experience in analysing the global financial markets.

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