NZD/USD slight offer on business PMI, bulls holding well on 0.73 handle
Currently, NZD/USD is trading at 0.7320, down -0.02% on the day, having posted a daily high at 0.7324 and low at 0.7317.
NZD/USD has moved into a phase of consolidation and remains bid despite the recent Business PMI that came in at 56.2 vs prior 58.5.
The bird has been propped up on the back of a mixed dollar and commodities that are resurging while markets concentrate on a shift in sentiment with respect to Central Banks, particularly the Fed. Yellen's dovish testimony has set back rate hike expectations and that is fuelling a flight to the carry trade, supporting higher beta currencies such as the New Zealand dollar. The next big data for the dollar comes as:
Analysts at Westpac have noted that the bird is holding up well, against expectations and suggested that a 0.7200-0.7345 range is likely during the day ahead.
NZD/USD 1-3 month:
Their forward outlook suggests that the Fed’s tightening cycle plus US fiscal expansion should eventually reassert upside pressure on US interest rates and the US dollar, pushing NZD/USD below 0.6800 by year end. US factors should outweigh local factors which are mostly supportive (25 May).
NZD/USD levels
Resistance: 0.7345 July 3 high; 0.7368 (today's high)/76 Feb. 7 high; 0.7393 Nov. 9 high. Support: 0.7300, 0.7280, 0.7220, 0.7205/06 June 22/21 lows; 0.7186 June 15 low; 0.7150 June 5 high; 0.7127 June 6 low. On the wide, on a break below 0.7080/00 opens 0.6970.
Author
Ross J Burland
FXStreet
Ross J Burland, born in England, UK, is a sportsman at heart. He played Rugby and Judo for his county, Kent and the South East of England Rugby team.
