NZD/USD takes-out 0.7100 resistance as USD selling remains unabated

The NZD/USD pair finally managed to conquer the 0.71 handle for the first time this week, as broad based US dollar sell-off continues to push the rates northwards.

NZD/USD unperturbed by NZ political uncertainty

Despite downbeat ANZ consumer confidence numbers, the Kiwi extends its bullish momentum, as the major closely tracks the USD price-action amid a lack of significant macro releases. The greenback was dumped broadly after the FOMC minutes came in dovish and showed that the Committee remains concerned over the inflation prospects, with the next rate hike dependent on the incoming inflation reports.

The spot also remains resilient amid a lack of clarity around the NZ political environment, as the New Zealand First Party held a fifth day of talks with both the ruling National and the opposition Labour Party to form a coalition government, but with no decisive conclusion out.

Markets now await the US PPI and jobless claims data for further take on the USD, while FOMC members Brainard and Powell’s speeches will also hog the limelight.

NZD/USD Levels to consider                                                                              

The NZD bulls guard 0.7081 (5-DMA), below which 0.7050 (psychological levels) and 0.7000 (round number) are key near-term downside areas. To the topside, a test of 0.7114 (10-DMA) due on the cards, which could open doors towards 0.7153 (200-DMA).