NZD/USD recovery aiming to conquer 100-DMA

The NZD/USD pair managed to defend Friday's three-day low support near 0.7145 region and staged a tepid recovery bounce amid broad based US Dollar retracement.

Currently trading at fresh session peak level around 0.7175 region, spot witnessed a short-covering bounce from lower level and has now moved within striking distance of 100-day SMA as the overall US Dollar Index pulled back from a over eight month highs. 

Increasing prospects of an eventual Fed rate-hike action remains the sole determinant of the pair's near-term trajectory and hence, market players on Monday would be focusing on speeches from couple of FOMC members, William Dudley and James Bullard, in order to determine the timing for next Fed rate-hike action. 

Meanwhile, speculations of further monetary easing by RBNZ at its meeting in November might restrict any sharp recovery. This coupled with higher probability of an eventual win for Hillary Clinton at the upcoming US Presidential election in November continues to underpin the greenback and hence, the pair remains vulnerable to resume with its near-term depreciating move. 

Technical levels to watch

From current levels, 0.7195-0.7200 handle seems to act as immediate resistance above which the pair is likely to extend the momentum further towards 50-day SMA strong resistance near 0.7250-55 region with 0.7225-30 providing intermediate hurdle. 

Meanwhile on the downside, a convincing break below 0.7150-45 immediate support is likely to accelerate the slide immediately towards 0.7100 handle before the pair eventually aims towards retesting recent lows support near 0.7050 region.