NZD/USD traders battling over 0.7340 ahead of NZ GDP

The NZD/USD is currently trading at around 0.7335 while market participants are waiting  for the New Zealand GDP numbers scheduled at 21.45 GMT. 

As New York closes, investors will turn their attention to the New Zealand dollar. The GDP is expected to have increased by 0.8% in the fourth quarter of 2017 compared to 0.6% in Q3. If the numbers come in better-than-expected then the NZD should gain some ground. The Kiwi has been performing better against other commodity-linked currencies such as the AUD and  the CAD, recently. However, if the number comes below expectations, investors must be cautious as the NZD might be sold off.

Earlier in the US session, US retail sales disappointed coming at -0.1% m/m against 0.3% expected by analysts. The DXY is virtually unchanged on the day so far.

NZD/USD 4-hour chart

The NZD/USD has found resistance at the 0.7340 level, which is the 61.8% Fibonacci retracement from the February 16 - March 1, down move. As seen on the 4-hour chart, the market tried to breach the level four times without success, leaving long tails signifying that the bears were owning the bars and winning the battle at the resistance so far. However, the sellers haven’t been as strong as they could be since they haven’t been able to bring the market down significantly and break the bullish trendline. The incoming GDP data might unlock the situation. If the resistance is broken there is nothing much in the way and bulls should be able to bring the market to the 0.7400 psychological level. On the opposite side, if bears win the market will most likely push through the 0.7320 intraday support and reach the 0.7280 level, the 38.2% Fibonacci retracement, close to the 100-period SMA. If the bears have enough strength they can hope to get to the 0.7240 level,  the 23.6% Fibonacci retracement.