NZD/USD remains trapped in congestion pattern as technicals weigh on pair
- RBNZ Governor Orr, NZ PMIs barely move the needle with Kiwi trapped in consolidation.
- US Retail Sales stumbled over forecasts, propping up the NZD.
- Friday to wrap up the trading week with US PPIs, Michigan Consumer Sentiment.
NZD/USD found some intraday gains on Thursday, bolstered by an unexpected decline in US Retail Sales in January, pushing down the US Dollar (USD) and giving the Kiwi (NZD) a lift, but the pair overall remains trapped in technical consolidation as long-term trends give way to congestion.
US Retail Sales decline by 0.8% in January vs. -0.1% expected
US Retail Sales unexpectedly fell in January, printing at -0.8% versus the forecast -0.1% and coming in well below the previous month’s figure of 0.4%, which saw a revision to the downside from 0.6%. The US Dollar broadly slumped across the FX space, sending the Greenback to the bottom of the major currencies pile.
Reserve Bank of New Zealand Governor Orr made an appearance that saw little market movement, and New Zealand’s Business NZ Purchasing Manager’s Index (PMI) revealed little new to markets as the economic indicator slowly grinds its way towards expansion after an eleventh straight month in contraction.
New Zealand’s Business NZ PMI recovered to 47.3 from the previous month’s 43.1, the economic activity indicator’s highest print since may of last year.
New Zealand's Business NZ PMI recovers to 47.3 from 43.1
Friday is set to wrap up the trading week with one last US data print, as well as Michigan University’s consumer sentiment survey results.
The annualized Core US Producer Price Index (PPI) is forecast to tick down to 1.6% from the previous period’s 1.8%, and Michigan’s Consumer Sentiment Index for February is forecast to recover slightly to 80.0 from January’s 79.0.
NZD/USD technical outlook
NZD/USD remains trapped in a near-term technical congestion zone with daily candles continuing to cycle the 200-day Simple Moving Average (SMA) near 0.6080 with a rough consolidation zone marked out between 0.6150 and 0.6050.
The Kiwi’s chart churn remains evident on intraday candles, and the pair is struggling to develop meaningful momentum after seeing technical resistance from 0.6130.
NZD/USD hourly chart
NZD/USD daily chart
Author
Joshua Gibson
FXStreet
Joshua joins the FXStreet team as an Economics and Finance double major from Vancouver Island University with twelve years' experience as an independent trader focusing on technical analysis.
