- NZD/USD trades near 0.6830 on early Friday morning.
- The pair previously dropped to 50-day SMA on US-China trade deal pessimism but strengthened recently on upbeat domestic New Zealand data.
- 0.6810 offers nearby support with 0.6880 likely restricting near-term upside.
NZD/USD is on bids near 0.6830 during the early Asian session on Friday. The quote bounced off 50-day simple moving average (SMA) during late-Thursday and is since carrying the recovery forward amid mixed signals from the US-China trade negotiation. Also directing the sentiment is February month business NZ purchasing manager index (PMI) and visitor arrivals (YoY) from New Zealand. Market participants may now look forward to developments surrounding the US-China trade deal and second-tier data from the US for further direction.
Earlier during Friday, business NZ PMI increased more than previous 53.1 to second best in past nine-month figure of 53.7. On the other hand, visitor arrivals rose to 5.3% from 3.1% previous growth on a yearly basis during the February month.
Having witnessed the US trade representative Robert Lighthizer and the secretary of state Mike Pompeo criticizing China during the early week, Kiwi traders remain disappointed after Bloomberg reported the Xi-Trump meet could now take place in April. Leaders of world’s two biggest economies, namely the US President Donald Trump and his Chinese counterpart Xi Jinping, were previously to meet sometime in March to give a final shape to the much-awaited trade deal between them.
Commodity-linked currencies dropped after the news report as China is the world’s largest industrial player. NZD/USD didn’t become an exception and dropped to the day’s low surrounding 0.6810. However, recently positive data from New Zealand helped the NZD to recover some losses in the morning.
Further, March month NY empire state manufacturing index and Michigan consumer sentiment index will be closely observed with February month industrial production (MoM) likely offering intermediate clues. The empire state manufacturing is expected to strength to 10.0 from 8.8 prior whereas the consumer sentiment index may also rise to 95.3 from 93.8. Additionally, industrial production could also reverse the previous contraction of -0.6% with +0.4% growth.
With the US lawmakers delaying talks with China and criticizing the dragon nation, investors fear for a no-deal scenario and on-going tariff war, which in turn weigh on commodities whereas likely upbeat data from the US may help perform its duty in favor of the USD.
NZD/USD Technical Analysis
While 50-day SMA level of 0.6810 acts as immediate support, pair’s further downside can challenge 200-day SMA figure around 0.6740 with 0.6780, comprising 100-day SMA, being an intermediate halt.
On the upside, a six-month-old descending trend-line, at 0.6880 acts as strong resistance, a break of which can recall 0.6910 but another downward sloping resistance-line joining highs since June 2018 may question buyers around 0.6920.
Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility.