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Forex: NZD/USD pares losses after Chinese milk quarantine roils kiwi

The NZD/USD experience a rapid 30-pip plunge during the overnight session, following a report that a Chinese quarantine led to the destruction of NZ milk powder. After bottoming out in the 0.8404 region earlier, the pair has rebounded nicely and recovered the mark of 0.8452/54 in these moments in a return to opening levels.

Later today in New Zealand, investors will grapple a pair of Producer Price Indices in the fourth quarter, beginning at 21:45 GMT – previous figures reported a contraction in Q3

The ICN.com Technical Analyst team points to resistive measures at the 0.8480 level, onto 0.8500 (key upside barrier), and eventually 0.8535. On the decline, a loss of the 0.8415 support will activate additional means of correction at 0.8400 and 0.8385.

Technically speaking, “the NZD/USD proved stability above the 0.8400 barrier, supporting that possibility of positivity again. Meanwhile, the stochastic is still moving negatively, however we will ignore that unless the pair holds below 0.8355. We suggest an upside move today depending on the ascending channel and stability above the mentioned support.” writes the ICN.com analyst team.

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