20.7 C
Munich

NZD/USD holds gains on the day, stays in search of upside break

Must read


NZD/USD holds above 0.7000, trades near the highs at 0.7025

Growing expectations of a RBNZ rate hike next month is fueling a move higher in the kiwi, with NZD/USD up 0.6% today to 0.7025 currently.

NZD/USD D1 16-07

The pair is once again looking to try and hold a break above 0.7000 but after the failure to hold above the figure level earlier in the week, there is room for trepidation.

Any major upside break remains elusive for now, with swing region resistance established this week @ 0.7043-44. Adding to that is the trendline resistance (white line) @ 0.7045.

As such, breaking above that is much needed for buyers to extend the next leg higher. That said, there is still added resistance from the 200-day moving average (blue line) @ 0.7071 before the 0.7100 handle comes into play.

The latter in particular has limited gains since late June so it is a key short-term technical level that buyers must break to catch that upside move.

As thing stand, the kiwi outlook is rather bullish but I’d prefer a more straightforward play such as the one against the aussie i.e. based on policy divergence (been preaching this since the RBA policy meeting at the start of the month).

Against the dollar, the greenback is still largely resilient with risk sentiment still in what can arguably be said to be cautious territory as equities retreat slightly from all-time highs and with the bond market rather unconvincing as of late.

US retail sales data will be a key one to watch later in the day to see if there will be a catalyst from there for any move or pullback in the pair ahead of the weekend.



Source link

- Advertisement -spot_img

More articles

LEAVE A REPLY

Please enter your comment!
Please enter your name here

- Advertisement -spot_img

Latest article