NZD/USD steps back from four-month high, ignores China’s upbeat PMI

NZD/USD shrugs off China’s better than forecast Caixin Services PMI while staying on the back foot around 0.6515 during early Tuesday.

China’s November month Caixin Services Purchasing Managers’ Index (PMI) beat 52.7 expected and 51.1 prior with 53.7 mark. It’s worth mentioning that China’s official and Caixin Manufacturing PMI recently registered upbeat numbers.

Even so, markets seem to care more about the trade war concerns than the likely improvement in Chinese economics. Escalation of the political tension between the United States (US) and China seems to gain market attention off-late, not to forget the fears of trade war between the US and rest of the major economies including Europe, Japan and East America.

News that the US still has Auto tariffs on cards and the US House passing sanctions on senior Chinese officials shows the Trump administration’s readiness to push the phase-one deal to 2020. On the other hand, China’s Foreign Ministry recently urged the US to stop wrongdoing regarding the Xinjiang Act after the dragon nation sanctioned the US Non-Government Organizations (NGO).

The risk tone heavies due to the same and exerts downside pressure on the S&P 500 Futures.

Market players seem to have contributed a liking for the NZD/USD pair as Commodity Futures Trading Commission’s (CFTC) positioning data for November 20 to 26 suggest a reluctance of short positions by the speculators.

Moving on, a lack of major data from New Zealand will keep focus on Friday’s key employment releases from the US. Forecasts concerning the US jobs report for November shows overall upbeat signs.

Technical Analysis

200-day Exponential Moving Average (EMA) level near 0.6515 acts as immediate key support whereas August month top surrounding 0.6590, followed by 0.6600 round-figure, stay on the Bull’s radar.