NZD/USD Price Analysis: Off fortnight-old support, 100-SMA on upbeat China PMI
- NZD/USD picks up bids to pare the biggest daily loss in a month.
- China Caixin Services PMI offered positive surprise in July.
- Recovery needs validation from immediate descending trend line.
- Bearish MACD signals, downbeat RSI challenge upside momentum.
NZD/USD takes the bids to refresh intraday high around 0.6240 after China flashed upbeat services activity numbers for July during Wednesday’s Asian session.
Not only the data but the 100-SMA and a two-week-long ascending support line also recall the Kiwi pair buyers after the bears cheered the biggest daily slump in a month the previous day. That said, RSI remains downbeat and the MACD signals also flash red marks, which in turn challenge the quote’s recent rebound.
It’s worth noting that China Caixin Services PMI for July rose to 55.5 versus 48 expected and 54.5 prior.
With this in mind, NZD/USD buyers approach an immediate descending trend line resistance, near 0.6270, but may have to struggle inside the fortnight-old bullish channel.
Hence, the stated channel’s upper line, near 0.6345, as well as the recent peak of 0.6353 could challenge the upside moves.
Alternatively, the 100-SMA and the aforementioned support line, close to 0.6220 and 0.6210 in that order, could restrict the NZD/USD pair’s immediate downside.
Also acting as the key downside filter is the 61.8% Fibonacci retracement of the quote’s upside from July 14, around 0.6170.
NZD/USD: Four-hour chart
Trend: Limited upside expected
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.
